Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

Oral Answers to Questions — SOCIAL SECURITY

Earnings Disregard

Mrs. Gorman: To ask the Secretary of State for Social Security if he has any plans to increase the disregard on earnings before income support is reduced.

The Parliamentary Under-Secretary of State for Social Security (Mrs. Gillian Shephard): We keep the level of the earnings disregards under review. The Government are committed to monitoring them, but we have no plans for change at present.

Mrs. Gorman: I thank my hon. Friend for her reply. Would she consider regarding as disregard the cost that a lone parent bears for child care if she decides to go back into the work force? Does my hon. Friend appreciate that many women who are left to be supported by the state because their menfolk have deserted them would like to go back to work? However, if they lose £1 for every £1 that they earn after the first £15, the incentive for them to be self-supporting is reduced. I know that my hon. Friend would not want to punish such women and I am sure that she would like to give them more of a helping hand.

Mrs. Shephard: I thank my hon. Friend, and in preparation for her question this afternoon I read her ten-minute Bill that, in part, dealt with that matter. My hon. Friend is right to say that many lone parents want to work, and about one third of family credit participants are lone parents.
The Government have built into the social security system several disregards and incentives especially for lone parents. For example, £15 of their earnings is disregarded in income support, they get the same adult credit in family credit as a couple and, from October, lone parents will have a £25 disregard in housing benefit. The major thrust of Government policy is to ensure that lone parents, 95 per cent. of whom are women, get adequate and proper maintenance from absent fathers.

Mr. Strang: If we are moving into the season of pre-election largesse—whether as suggested in the Minister's answer to the hon. Member for Billericay (Mrs. Gorman) or in the report in today's The Guardian—will the hon. Lady take into account the plight of my constituent Mr. Stewart, about whom she wrote to me last month and who came to see me at the weekend? Mr. Stewart has had no increase in his income since April 1988, when the Government removed his special payments; he is

having to pay increased electricity charges, and he is having to pay 20 per cent. of his poll tax. Is there no limit to the extent to which the Government are prepared to inflict real hardship and misery on some of our poorest pensioners?

Mrs. Shephard: Transitional protection was introduced to help those who might lose out under the 1988 social security reforms. A small number of people are still covered by transitional protection and the overwhelming majority of them received an increase this April.

Mr. Strang: For my constituent—not this year or next year.

Mrs. Shephard: The hon. Gentleman will know that I cannot comment on an individual case. I am glad that he pointed out that I have already replied to him.

Claimants (Residential Backgrounds)

Mr. Harry Greenway: To ask the Secretary of State for Social Security if there are any limitations as to the residental background of recipients of attendance and other allowances; and if he will make a statement.

The Minister for Social Security and Disabled People (Mr. Nicholas Scott): Attendance allowance is payable to people who live in independent residential care homes. It stops after four weeks for those living in other residential homes if the care costs are met from public funds. Limitations for other allowances vary.

Mr. Greenway: Does my right hon. Friend accept that many elderly people who are of sound mind find it difficult and irksome to live with the confused elderly and those who are deeply ill?

Mr. Winnick: What about the Prime Minister?

Mr. Greenway: The hon. Gentleman speaks for himself. He is somewhat confused and always has been.
Will my hon. Friend consider introducing changes to the allowance system so that people who are on attendance allowance can live not in nursing homes or in institutions but, for example, in private accommodation, where they could pay their way with the allowance?

Mr. Scott: Yes. I understand that my hon. Friend has a constituency case. He has quite properly written about it to the local office manager, who will be replying soon. Some quite complicated calculations have to be made to see whether people would be better off if they moved into private accommodation from residential homes of one sort or another. Individual judgments will have to be made. Within the private residential sector, there is a wide range of types of property and provision.

National Insurance

Mr. Ian Bruce: To ask the Secretary of State for Social Security how many standard rate tax payers would be affected by the removal of upper earnings limit for national insurance contributions.

The Secretary of State for Social Security (Mr. Tony Newton): If the upper earnings limit for employees' national insurance contributions were removed it is estimated that about 3·3 million people would pay more contributions, of whom about 2·1 million would be


standard rate taxpayers. If the corresponding upper profits limit for self-employed people were also removed, it is estimated that about another half a million people would pay more contributions, of whom about 200,000 would be standard rate taxpayers.

Mr. Bruce: I thank my right hon. Friend for that illuminating reply and I hope that it will be well covered by the media, because these are the Labour party's policies. As we have taken a great deal of time and trouble to remove Labour's tax on jobs—the national insurance surcharge—will we also look at the employers' national insurance contribution, which is running at roughly double the amount that it was in the days of the Government led by my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath)?

Mr. Newton: My hon. Friend is quite right to draw attention to the figures that I have given. I note what he suggested about the employers' contribution, but there is no upper earnings limit on it, and because of the way in which the national insurance system works and the direct relationship between the contribution paid by employees and the benefits subsequently received, I am not sure that the arguments are on all fours.

Mr. Winnick: When an individual pays both national insurance contributions and tax, to ensure that when he becomes unemployed or sick, the state gives him assistance, how can there be any justification for reducing or taking away unemployment benefit? There is speculation about that in the press. Will it also be mentioned in the Tory manifesto, because the people want to know the truth? If unemployment benefit is to be taken away, how long will it be before pensions are undermined and perhaps taken away by the Government?

Mr. Newton: I am grateful that the hon. Gentleman used the word "speculation". As far as I can see, the press reports to which he referred rest on one pamphlet from one body, the Adam Smith Institute. That is not a Government plan and there is no basis for the hon. Gentleman's suggestion.

Mr. Beaumont-Dark: Is not it true that, since the Conservative party came to power, most people who pay national insurance have saved over £3 a week on it, but under the Opposition's glorious plan, the people whom the Opposition laud as those whom they want to encourage—those earning between £15,000 and £20,000 a year—will pay £9 a week more? They would not pay that in national insurance; the fraud is that they would pay it in increased taxes. How does that encourage people to work?

Mr. Newton: The answer is that that does not encourage people to work and that it runs exactly contrary to what we have sought to do in reducing national insurance contributions for many, with the aim of encouraging employers to provide jobs and encouraging people to do them.

Mr. Meacher: If the Secretary of State is so concerned about the extra tax on higher rate taxpayers, how does he explain why the Government have increased, for instance, national insurance contributions, which are a tax, by no less than 14 per cent. for those on average or low incomes?
In view of his earlier answer, is the Secretary of State—or is it only the Prime Minister—in favour of the latest crackpot, right-wing daftness of privatising the dole, but

still making people pay national insurance contributions so that they are forced to pay twice for the same benefit? If people have paid national insurance contributions, are not they contractually entitled to benefit? If something in the private sector that had been fully paid for were taken away, would not he, or even the Prime Minister, call that stealing?

Mr. Newton: It is perhaps understandable, in view of the events of recent weeks, that the hon. Gentleman should go to such lengths to divert attention from the main point. He referred to higher rate taxpayers. The point is that Labour's plans, as is clear, and is clearer still from my answer, involve higher contributions from many basic rate taxpayers. That is the point that the Opposition have been seeking to disguise because they do not want to let on how many people will have to pay much more to finance the hon. Gentleman's ambition.

Personal Pensions

Mr. David Evans: To ask the Secretary of State for Social Security what estimate he has as to the number of people who have now joined a personal pension scheme.

Mr. Donald Thompson: To ask the Secretary of State for Social Security how many people are taking out personal pensions; and if he will make a statement.

Mrs. Gillian Shephard: Just over 4 million people have so far taken out a personal pension.

Mr. Evans: Does my hon. Friend agree that the most encouraging aspect of that figure is that it represents people in all age groups who have provided for their retirement? Does he further agree that it is absolutely disgraceful that the hon. Member for Oldham, West (Mr. Meacher) should seek to penalise those 4 million people—or probably 10 million people, when one takes their families into consideration? Is not this what the Labour party is all about—muddled thinking, total misrepresentation and, worst of all, patronising people? In other words, we know best.

Mrs. Shephard: To borrow a recently expressed phrase, that is an example of the Opposition's crackpot, left-wing culture—

Ms. Short: This is disgraceful. It is an abuse of Question Time—

Mr. Speaker: Order. The Minister is answering the question.

Ms. Short: This is an abuse.

Mr. Speaker: Order.

Mrs. Shephard: What is important about the Government's pension provision is that people now have a choice between remaining in the state earnings-related pension scheme, taking out a private pension and belonging to an occupational pension scheme. The Opposition have made it clear, through the hon. Member for Oldham, West (Mr. Meacher), that they are totally against that choice and independence in pension provision—

Ms. Short: Will you do something about this abuse of Question Time, Mr. Speaker—

Mr. Speaker: Order. The questions that were asked were in order, and if they were not I should rule them out of order.

Mr. Thompson: Does my hon. Friend agree that the hon. Member for Birmingham, Ladywood (Ms. Short) is muddled, as this is not Prime Minister's Question Time? We are asking specific questions on specific matters. Does she agree that, to use the words of the hon. Member for Oldham, West (Mr. Meacher), the Opposition intend to steal private pensions from people?

Mrs. Shephard: The hon. Member for Oldham, West has already made clear his party's intentions for personal pensions. Fortunately, the Government intend to continue the policy of choice within pension provision between SERPS, a personal pension and an occupational pension scheme. Clearly, the Opposition wish to threaten that choice.

Mr. Meacher: On a point of order, Mr. Speaker. Is not it an abuse of the House that Question Time is used in regard to Opposition policies, which we shall certainly defend and promote when we have a chance? Is not the purpose of Question Time to hold Government policies to account?

Mr. Speaker: This is not Prime Minister's Question Time and these are not open questions. It is the function of questions on the Floor of the Chamber to expound on policies, and that is what we are here to do.

Mr. Flynn: To return to the question, does not the Minister feel a sense of guilt that she is aiding and abetting what is becoming the fraud of the century now that 4 million people have been bribed by dodgy advertising into taking out pensions? Does not she recognise that they are not pensions—they are risky savings schemes that are about as personal as a can of baked beans? When will the Government respond to the independent voices that are saying that more than 1 million people have been defrauded by such schemes and that most of their future benefits and pensions have already been eaten up by commission charges, administrative costs and the profits of the pension companies? Can it be possible that the Government are about to replicate that calamity by abolishing the dole? Will they give us a categorical denial, other than the arguments that have been presented today, and tell us that it is a product of midsummer madness by the loony right and that none of the Ministers will have any part in that crazy scheme to abolish the dole?

Mrs. Shephard: I was under the impression, although much noise was being made by Opposition Members, that my right hon. Friend the Secretary of State gave absolute assurances about the Adam Smith Institute pamphlet. The hon. Member for Newport, West (Mr. Flynn) repeated the comments made by the hon. Member for Oldham, West to try to scaremonger and to terrify perfectly normal, ordinary people who wish to take advantage of the excellent pension choices that have been made available by the Government. It is a disgrace.

Community Care Grants

Mr. Andrew Welsh: To ask the Secretary of State for Social Security what was the budget for community care grants in the latest financial year for which figures are available.

Mr. Scott: The community care grant budget for 1990–91 is £63 million.

Mr. Welsh: Community care grants are essential to integrate people back into the community. How will cuts in grant affect that integration? How will the grants enable people to obtain suitable housing in order to allow them to return to the community? What is the Minister's view about the role of housing providers? Will they be an essential partner in community care schemes and planning or merely an afterthought?

Mr. Scott: The budget for community care grant has not been cut but increased for the current year. I hope that as we develop our policies for care in the community, which we aim to introduce in 1991, there will be increased co-operation between social services departments, which will be involved increasingly in the provision of community care, and local housing departments so that proper arrangements can be made for those leaving institutions.

Sir George Young: My right hon. Friend will know that community care grants are available only to those on income support. Many who would benefit from them receive invalidity benefit or other benefit and are therefore disqualified. Will he sympathetically consider extending the grants to other members of the community who would benefit from them?

Mr. Scott: I shall consider my hon. Friend's suggestion. There are administrative advantages in limiting community care grants to those who are on income support, and there are resource implications, but I have noted my hon. Friend's point.

Mr. Alfred Morris: If the social fund is so successful, why are so many disabled people now trapped in the jaws of loan sharks? Would not it much reduce dependence on community care grants if the Government quickly accepted the social security commissioners' decision, which was reported last week, in the important test case for severe disability premium of Simon Crompton, of Greater Manchester, which is estimated to benefit 30,000 other disabled people? What action is the Minister taking to identify them?

Mr. Scott: We are considering the implications of that judgment. The fact that loans under the social fund are interest free is likely to remove people from rather than hand them over to the loan sharks.

Pensioners (Income)

Mr. David Davis: To ask the Secretary of State for Social Security by how much pensioners' total incomes have risen (a) since 1979 and (b) between 1974 to 1979.

Mrs. Gillian Shephard: I am pleased to be able to tell my hon. Friend that while pensioners' total net incomes rose by only 3 per cent. in real terms between 1974 and 1979, they rose on average by more than that in each year


between 1979 and 1987. In total, they rose by over 31 per cent. in real terms in this Government's first eight years of office.

Mr. Davis: I thank my hon. Friend for that reply. As it is fashionable to quote the hon. Member for Oldham, West (Mr. Meacher) today, I am sure that she is aware of his comments in the Chamber on 30 January, when he said that the important consideration is the increase in pensioners' average income over the course of a Government. If my calculations are correct, we have done six times as well as the previous Labour Government. Does my hon. Friend therefore agree that a strong and proper pensions policy depends on two pillars—first, the strength of the economy, which enables us to pay proper state pensions and, secondly, a healthy economy giving a proper return on pensioners' savings? On both counts we outperform the poor performance of the previous Labour Government and the poor promises of a would-be Labour Government.

Mrs. Shephard: I agree with my hon. Friend. It is clear that the successful economic policies pursued by the Government have enabled us to spend £55 billion a year in real terms on social security and spending on pensioners and the elderly to increase by a quarter. To pursue anti-inflationary policies is particularly important for pensioners.

Mr. Frank Field: I accept the accuracy of the Government's figures although, of course, they have not yet been checked by the Select Committee. Will the hon. Lady confirm that for the poorest pensioners the most important thing to look for is a real increase in national insurance benefits? Will she confirm that, under the Labour Government, pensions for that group rose by 20 per cent. and under this Government they are yet to rise by 3 per cent?

Mrs. Shephard: The incomes of the poorest pensioners increased by 19 per cent. in that same period. As the hon. Gentleman will know, the numbers in the lowest quintile decreased from 38 to 24 per cent.

Mr. David Nicholson: Is not it important to look carefully at the differences in income and support between the younger pensioners and other older pensioners, aged over 75? Have not younger pensioners in particular done extremely well with regard not only to income but to home ownership and personal and occupational pensions? Is not it necessary to look carefully at the incomes and the support given to older pensioners who have not done so well with regard to home ownership and occupational pensions?

Mrs. Shephard: My hon. Friend is right. Seventy per cent. of recently retired pensioners have occupational pensions, half own their own homes and 85 per cent. have income from savings. The Government have taken action to help the older, poorer pensioners through the package of measures announced last October, which helped 2.6 million individuals.

Mr. Kirkwood: No one seeks to deny the important improvements in the standards of living that pensioners with occupational pensions and savings have enjoyed over the past few years. Does the hon. Lady accept, however, that it is a great mistake for Government policy to be predicated on the basis of gross public expenditure

increases or average pensioners' incomes? Does she further accept that, over the past year, the erosion in pensioners' standards of living because of the difference between the retail prices index and earnings levels has been a constant source of concern for poor pensioners? If the package of measures last October was so successful, why will not the hon. Lady repeat it this October?

Mrs. Shephard: I am glad that the hon. Gentleman implicitly accepts that the October package was a success. Its aim was to target help towards older and poorer pensioners. I am sure that those who are responsible for dealing with those matters will listen to the hon. Gentleman's points when he asks for them to be considered next October.

Mr. Gow: Is my hon. Friend really telling the House and the country that pensioners' living standards have risen faster in each of the past 11 years of the Conservative Government than in the six years of the previous Labour Government?

Mrs. Shephard: That is exactly the case. My hon. Friend puts the matter accurately

Ms. Short: Perhaps the hon. Member for Eastbourne (Mr. Gow) would like to think about the fact that, by comparing five years and 11 years, one gets rather different outcomes. This is another attempt by the Government to manipulate and misuse the agenda of the House. I hope that you will reconsider your earlier ruling, Mr. Speaker, or any democratic procedure for holding the Government accountable will break down. I put it to the Minister—I am sure that she knows this to be true—that, according to the Library, 20 per cent. of pensioners rely entirely on state benefits. The Government have cut state pensions by £13.20 for a single pensioner and £20.70 for a couple. Labour takes great pride in the improvement in many pensioners' incomes due to the introduction of SERPS, which the Government have now cut, resulting in a reduction in the incomes of future pensioners. Labour is proud of the improvements for some but is worried about those who are finding life increasingly hard, many of whom are women. The poorest pensioners are women, and the Government are doing nothing for them.

Mrs. Shephard: The average income of pensioners who receive all their income from state benefits has increased by over 27 per cent. during the life of this Government. If the hon. Lady and her hon. Friends go on threatening and scaremongering about the choice, independence and diversity that the Government have introduced into pensions, they will live to rue the day.

Income Support

Mr. Nellist: To ask the Secretary of State for Social Security what is the amount within an income support payment which is imputed to cover the 20 per cent. liability for poll tax; and if he will make a statement.

Mr. Tony Newton: On average, income support beneficiaries receive the equivalent of 20 per cent. of a community charge of £340.

Mr. Nellist: As the average poll tax is £100 higher than was envisaged when the Government introduced the £1.30 payment per person on income support to cover that notional 20 per cent., why have not the Government


increased the figure to 20 per cent. of the actual average poll tax? In Tory-controlled Windsor and Maidenhead, for example, the poll tax is £449 and 20 per cent. of that is £1.72; the odd 40p may not mean much to a Minister on nearly £1,000 a week, but to someone on income support it means a loaf of bread.

Mr. Newton: The level of community charge varies from place to place. The amount that people have to pay reflects the decisions of their local council, and there is an element of that in respect of income support. I hope that the hon. Gentleman will accept the figure that I gave in my original answer. The weighted average amount included in income support payments across Great Britain is equivalent to 20 per cent. of what has turned out to be the average community charge across Great Britain after allowing for transitional relief.

Mr. Dickens: Is it not a fact that all people on income support receive the full maximum 80 per cent. rebate on their community charge? Do not those on income support also benefit from transitional relief, which cost the Government £350 million in England alone and which benefits 7.5 million people? Does not that show that we are the Government who care for the disadvantaged?

Mr. Newton: I can confirm that those on income support pay only 20 per cent. of their community charge—the other 80 per cent. is met directly—and that many income support beneficiaries will have benefited from the transitional relief scheme.

Mr. Campbell-Savours: Is the Secretary of State aware that in my constituency of Workington, and throughout the north-west, there is a disturbing incidence of young people leaving home because of changes in social security legislation and also because their parents will not help out with payment of the poll tax? Was it really the Government's intention to drive young people out of their family homes? If it was not, will they reconsider the legislative provisions which are having that effect?

Mr. Newton: The hon. Gentleman will know that we have made a number of changes in the way in which the benefit rules operate, in an endeavour—I pay tribute to my hon. Friend the Parliamentary Under-Secretary of State for Social Security for the work that she has done in this regard—to ensure that the rules, which are sensible, work as well as we should like them to. I ask the hon. Gentleman to recall the history of social security and young people, especially under the old board and lodging regime. The attempt to solve the problems by social security means has aggravated rather than diminished them.

Mr. Stern: To revert to my right hon. Friend's original answer, does he agree that his reference to the Government's taking into account an average community charge of £340 underlines the sheer cruelty and lack of concern for the poorest people implicit in the attempt—shortly to be frustrated, I hope—by Bristol city council and Avon county council to levy a community charge of £493?

Mr. Newton: I agree with my hon. Friend that the core of such problems as are faced not only by those on benefit but by many others whose incomes may be quite modest reflects the irresponsible decisions of many councils throughout the country.

Homelessness

Mr. John Evans: To ask the Secretary of State for Social Security what further measures his Department is planning to take to reduce the problems of the homeless.

Mrs. Gillian Shephard: My hon. Friend the Minister for Housing and Planning announced a substantial package of measures on Friday 22 June to deal with this problem. We believe that this is the best way to tackle the issue, rather than through benefit changes.

Mr. Evans: Is the Minister prepared to concede that the Government's legislation, especially in relation to the withdrawal or reduction of social security benefits for young people and the imposition of the poll tax, compounded by their refusal to allow local authorities to build houses for rent, have created the appalling homelessness which exists in Great Britain today? Does she agree that renting a few church halls will not solve the problem?

Mrs. Shephard: The hon. Gentleman will be aware that the problem of homelessness spans a number of Government Departments and a number of countries throughout the world. He referred specifically to young people, however, and I remind him that there is no need for any 16 or 17-year-olds to be without an income. They can have a job, remain in education or take a YTS place. We have made a number of administrative changes and we raised the benefit level last July to help that particular group. I fully accept that there were some problems with the interaction between the Department of Social Security and the operation of youth training schemes, but we have done everything possible to put that right. It is surely better for young people to start their adult lives in school, in a job or in training rather than trying to live on benefit.

Mr. Favell: Has my hon. Friend noticed that young people who sleep rough almost always seem to come from the indigenous population and rarely from the immigrant population, who always seem to find somewhere to live? How can that be so? Would not it be unreasonable to provide expensive council house accommodation and flats for young people who merely leave home when others have to save, often for years, to find the accommodation that suits them?

Mrs. Shephard: I have already stated in reply to an earlier question that the Government believe that the best possible start for young people is to take training places, of which there are plenty—even a surplus—available and if possible to live at home. There are special benefit arrangements for those who have to live away from home.

Mr. Nellist: Does the Minister not understand the difference between the roofless and the homeless? While the announcement of a recent package of measures involving opening up a few chuch halls put a roof over some young people's heads, those measures do nothing to solve the underlying problem that thousands of teenagers are being driven out of their homes by the conditions created by the Government, not least through the stealing of YTS allowances and the general cut in benefits?

Mrs. Shephard: I totally rebut the hon. Member's accusations. If larger numbers of young people are leaving home than in previous years, that is also a matter of concern for their parents.

Maintenance

Mr. Ralph Howell: To ask the Secretary of State for Social Security when he expects to announce proposals resulting from his review of the maintenance system; and if he will make a statement.

Mr. Newton: We are pressing ahead with the review of maintenance, which is wide ranging, and are examining all areas of the current system to see where reform is required. We hope to make proposals later this year. Meanwhile, there are measures in the present Social Security Bill which address some of the problems that lone parents have experienced with the current system. My right hon. Friend the Minister of State, Home Office, has recently announced proposals to reinforce payment arrangements.

Mr. Howell: I thank my right hon. Friend for that reply and I wish him well with the proposals that he is bringing forward. They are long overdue.

Mr. Newton: I am duly grateful to my hon. Friend.

Mr. Meacher: I shall ask a real question. Is the right hon. Gentleman aware that the Government's first effort in that direction—the enforcement of payment through attachment of earnings—is merely a pathetic re-statement of existing law? Why is there nothing about the real issues such as the level of awards, which in general is far too low? What incentive is there for mothers to claim maintenance if the Department of Social Security simply claws it back in reduced income support? Do not the proposals have all the makings of yet another Tory ramp of reducing public expenditure instead of giving extra help to those in real need?

Mr. Newton: I really think that the hon. Gentleman might tone down some of the overheated language that he so persistently uses. First, the proposals of my right hon. Friend the Minister of State, Home Office, involve legislation and thus can scarcely be simply a re-statement of existing law—[Interruption.] Having asked three questions, perhaps the hon. Gentleman will allow me to answer them.
Secondly, as we announced to the House earlier this year, we have already taken action to strengthen the way in which maintenance is assessed and the amount that is expected under the current DSS rules.
Thirdly, the advantage to lone parents is that their position is much better if they are getting maintenance, especially when they enter work, than if they are wholly dependent on DSS benefits.

Mr. Hind: Will my right hon. Friend consider the position of single mothers bringing up children on their own without any assistance from the fathers, particularly when the fathers are known? Does he agree that it would be appropriate to ask those mothers to make applications to the courts for maintenance so that the fathers face up to their duty to support their children rather than leaving the whole burden to the taxpayer?

Mrs. Gorman: You have to catch them first.

Mr. Newton: Yes, and indeed we do. Lone mothers in those circumstances can face a number of practical problems. We are seeking to address those problems in the Social Security Bill—for example, by legislating to make it possible for the Department's own maintenance orders to

be transferred to claimants when they leave income support, and by taking powers to enforce a claimant's own maintenance order if it falls into arrears.

Retirement Age

Mr. Simon Hughes: To ask the Secretary of State for Social Security what are his current plans for introducing a common retirement age for men and women in relation to the state pension.

Mr. Newton: The Government's position remains as described in the response, published in April, to the report of the Select Committee in another place.

Mr. Hughes: Now that we are beginning to see signs of the Government's programme for the coming year and what the Prime Minister would like in their manifesto for the next election, and as the Prime Minister will be 65 this autumn, may we at last have a clear commitment from the Government to a common retirement age for women and men?

Mr. Newton: I have referred to our response to the Select Committee in another place, and I have no doubt that the hon. Gentleman will have read it. The hon. Gentleman will be aware that the Government are committed to the principle of equal treatment, but there are a range of difficult, complex practical issues and I really cannot give the hon. Gentleman the off-the-cuff undertaking that he seeks.

Oral Answers to Questions — THE ARTS

Museums and Galleries (Charges)

Mr. Simon Hughes: To ask the Minister for the Arts what recent representations he has received calling for access to all public museums and galleries to young people under 18 years to be without charge.

The Minister for the Arts (Mr. Richard Luce): In recent months, I have received a number of letters concerning admission charges in the national nuseums and galleries which I sponsor. Those institutions which levy an admission charge allow free or concessionary entry to all pre-booked school parties and students. The decision whether to introduce admission charges is, of course, a matter for the trustees and directors of individual institutions.

Mr. Hughes: Is the Minister aware that about 15 per cent. of all museums and galleries in London charge more than £2 for young people's admission and that fewer than 5 per cent. have free admission? Will he state that it is the Government's view that, wherever possible, it should be a museum's or gallery's policy that young people should be admitted free of charge as part of their general education?

Mr. Luce: The decision whether admission charges should be imposed is for the trustees, but if national museums and galleries were to impose charges—about five in the London area have decided to do so—in most, if not all, cases there would be concessionary rates for children. That means that most children would be admitted at half price. There are any number of examples of free admission for school parties. That is an important principle to pursue.

Mr. Dunn: Will my right hon. Friend arrange for all museums and public galleries in this country to hold exhibitions for people under the age of 18 on the history of Labour Governments since 1900, all of which have ended in disaster, especially for those least able to defend themselves?

Mr. Luce: My hon. Friend has introduced an interesting idea, although I am not sure how many members of the public would bother to go to such an exhibition—we should have to wait and see. It must be stressed that, when admission charges are imposed, it is important for the public to see a clear benefit to the customer. For example, the science museum has free admission on certain days and is open on more bank holidays than before.

Mr. Fisher: Does the Minister accept that the first step to widening access and encouraging children to go to our great national galleries is for those galleries to be in good condition? Does he support the plan of the Arts Council chairman, Mr. Peter Palumbo, to restore the fabric of our theatres, museums and galleries by the end of the century? Does he accept Mr. Palumbo's point that the problem—indeed, the crisis—has been caused by the Government's neglect over the past 10 years? Will he at long last accept what I have been urging him to do for the past three and a half years and have a national audit of all museums, galleries and other cultural buildings so that we know how big is the legacy of debt that the Government are leaving to the country?

Mr. Luce: I look forward to dealing more fully with some of those issues in the debate on Wednesday, when shall answer some of the hon. Gentleman's nonsensical points. Since 1979, the overall real resources of the national museums and galleries have increased by no less than 40 per cent. and for building and maintenance by 50 per cent. In September I announced that £180 million would be made available for the fabric of our national institutions. That is very much in line with the view expressed by Mr. Palumbo that we should get our institutions and their fabric in good shape.

Mr. Harry Greenway: Will my right hon. Friend take a leaf out of the French book in relation to the treatment of museums and galleries and ensure free admission for large families and men or women mutilated in wars?

Mr. Luce: I am sure that the leaders of the institutions in Britain will acknowledge the point made by my hon. Friend, but it is for them to decide what should be done. Some British institutions, unlike the majority of French institutions, do not charge at all.

Photography

Mr. Boyes: To ask the Minister for the Arts whether it is his intention to vary the Arts Council's responsibility for photography.

Mr. Luce: No, but I expect the council to review its support for photography as part of its development of a national strategy for the arts.

Mr. Boyes: I welcome the Government's plans for devolution, especially that aspect which permits regional art association photography offices to work closely with the national officer. That will enable all the officers to

formulate a coherent national policy for the further development of photography, especially in the context of funding for regional galleries, but does the Minister accept that carrying out those plans will require adequate funding and support from the Minister?

Mr. Luce: I am grateful to the hon. Gentleman. There has been a 10 per cent. increase this year over last year in overall resources for the Arts Council to give to photography. I am sure that that will play a part in helping to strengthen photography in Britain.
I cannot let this occasion pass without congratulating the hon. Gentleman on his achievement in producing the book, "People in Parliament", and I congratulate him the more strongly inasmuch as I am one of the people who feature in the book. I also congratulate him on his leading part in organising the remarkably good exhibition of photographs by hon. Members—an exhibition which shows that there are many hidden talents in the House.

Paintings

Mr. Boswell: To ask the Minister for the Arts whether he will make a statement on the public display of paintings.

Mr. Luce: I have been much impressed by the recent expansion of the range of paintings on display in London, including the new Courtauld Institute galleries and the generous loan of the Berggruen collection to the national gallery. There are, of course, many other developments outside London.

Mr. Boswell: My right hon. Friend's answer reveals that the position not just in London but in the provinces is very good. Will he redouble his efforts to ensure by the use of loan paintings and the reserve collection that people who do not live in London can see the excellent pictures available in the metropolis?

Mr. Luce: My hon. Friend is, of course, right. A special exhibition and travelling unit advises on such matters at the Museum and Galleries Commission. There are now more loans available throughout the country and more objets d'art are outside the cellars and on display, but there is still a long way to go. As for London, I noted the other day that the chairman of the national gallery, Lord Rothschild, said that he believed that London is now the paintings capital of the world. In view of the remarkable developments of the last few years, I am sure that he is right.

Mr. Bidwell: May I draw the attention of the Minister and of the Opposition spokesman, my hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher), to the resumption of the exhibition of paintings and art by Members of both Houses? The exhibition opens officially tomorrow morning, but the works are already displayed in all their glory. There are some fine exhibits on show and admission is free. After a two-year gap, there are some splendid contributions this year. Modesty prevents my saying any more.

Mr. Luce: I am grateful to the hon. Gentleman for drawing to the attention of the House and the outside world once again the hidden talents available in the Chamber.

Building Refurbishments

Mr. Carrington: To ask the Minister for the Arts what programme of refurbishment of buildings within the responsibility of the Office of Arts and Libraries has been established.

Mr. Luce: I am allocating £180 million over the next three years towards the building programmes of the national museums and galleries which I sponsor. The current year's allocation of £57 million represents a 75 per cent. real terms increase over 1979–80.

Mr. Carrington: Will my right hon. Friend also confirm that the private sector has played a major role in refurbishing and repairing our museum buildings? Will he congratulate those responsible for the major refurbishment work on the facade of the Victoria and Albert museum which is turning out splendidly and rising phoenix-like from its scaffolding? Will he also—

Mr. Speaker: Order. I think that that is enough.

Mr. Luce: I agree with my hon. Friend about the remarkable contribution of the private sector to the refurbishment of national galleries, including the V and A. By contrast, £5 million of extra private sector money has been made available for the British museum by the Japanese to help open the Japanese galleries. There are several other examples. Most notably, Lord Wolfson has joined the Government in a joint funding exercise to help with the improvement of the national galleries in our country.

Mr. Sheldon: While I am pleased with the reaction of so many of the people with responsibility for some of our public buildings and the arts aspects of them, does the Minister agree that we need long-term funding for many buildings which have fallen into disrepair? That funding is urgently required, not just for the next year or two, but for the next decade or two.

Mr. Luce: I take the right hon. Gentleman's point seriously. That is why I made a speech in York last September about longer-term funding for the fabric of our national institutions, particularly the national museums and galleries. It is for that reason that, with the co-operation of my colleagues in the Government, I decided to allocate £180 million for that purpose for the next three years. I have given an undertaking that it is the Government's task, job and duty to ensure that the fabric of those institutions in particular will be in good shape for the next decade.

Oral Answers to Questions — CIVIL SERVICE

Retired Civil Servants (Appointments)

Mr. Beith: To ask the Minister for the Civil Service whether he has any plans to revise the rules governing the appointment of retired civil servants to senior positions in companies with whose subject area they have dealt during their public service careers.

The Minister of State, Privy Council Office (Mr. Richard Luce): The rules are kept under review and were last revised in 1989. I have no present plans to revise them again.

Mr. Beith: Does the Minister agree that those rules, which preclude civil servants from taking senior board appointments in companies within two years of their retirement, are an important safeguard against civil servants being suspected, perhaps wrongly, of being influenced while in office by the hope of such appointments? Is not it strange that civil servants are in that position when the Ministers whom they advise, and who frequently neglect their advice, are not subject to similar restrictions and former Secretaries of State for Trade and Industry or for Energy can take appointments in the industries that they have privatised?

Mr. Luce: The position for civil servants is as the hon. Gentleman describes. Of course, it is possible for their appointments to outside jobs to be delayed for up to a maximum of two years. It is not a rule that such appointments are delayed for two years. They can be delayed for up to a maximum of two years. Those rules have been in force for a long time. I am not directly answerable for the actions of Ministers, except for my own actions. However, the position is clear. I agree with the view expressed by my right hon. Friend the Prime Minister and that expressed by Lord Wilson in 1968, that it should be up to the good sense and discretion of Ministers when they retire. Clearly, they will care deeply about their public reputation. Their talents and abilities, along with those of civil servants, should be available to the nation and the private sector should be allowed to benefit from them.

Mr. Rhodes James: Is my right hon. Friend aware that anxiety about this matter is not confined to the other side of the House and that, in particular, civil servants who have received considerable salaries and pensions must be careful about their relationship with the private sector after they retire from the public sector where they received confidential and important information?

Mr. Luce: I fully acknowledge what my hon. Friend says. I am responsible for propriety, and I am most anxious to ensure that we continue with the highest possible standards. Under the rules, applications are sent to the advisory committee on business appointments and to the head of the home civil service when lower grades are involved. My hon. Friend might like to know that conditions were imposed upon more civil servants who were going to outside jobs in 1989–51 per cent.—than in 1988, when the comparable figure was 34 per cent., and in 1987, when it was 26 per cent. That is a sign that the issue is being treated seriously.

Trade Unions

Mr. Fisher: To ask the Minister for the Civil Service when he last met representatives of the civil service trade unions; and whether he discussed conditions of service.

Mr. Luce: I meet the civil service unions from time to time to discuss a range of matters.

Mr. Fisher: When the Minister next meets the civil service unions, will he take the opportunity to dissociate himself and the Government from the report in The Guardian today of the thoughts of the right-wing Tory No Turning Back group for a pay-as-you-like or pay-whatyou-like tax system? Is not this a typical, desperate last attempt by the Conservative party to flag up its growing unpopularity in the opinion polls?

Mr. Speaker: Order. The hon. Gentleman's supplementary question should relate to the conditions of service of civil service trade unions.

Mr. Fisher: Does the right hon. Gentleman not understand that the bash-the-taxman idea behind the scheme is deeply offensive to civil servants and will do nothing but lower morale among Treasury civil servants who are collecting taxes on our behalf?

Mr. Luce: I cannot see the direct connection between the hon. Gentleman's supplementary question and the civil service. The production of new thinking and new ideas from all parts of the Conservative party is a sign of how alive the party is and how much it is looking forward to serving the country in the 1990s.

Mr. Aitken: Has my right hon. Friend had time to discuss with the civil service trade unions the concern that they feel about Treasury report No. 2435, which recommends the downgrading of the pay and structure of a number of security officers and investigating officers in the sensitive area of physical security of Ministry of Defence buildings and of positive vetting? Does my right hon. Friend agree that a report which appears to seek to reduce by as much as £2,400 a year the pay of the 350 or so officers who work in this sensitive area is sending the wrong signal to the IRA and others and that there should be careful reconsideration of those misguided proposals?

Mr. Luce: That is a matter which should be drawn to the attention of my right hon. Friends, and I shall do that. I note what my hon. Friend has to say.

Dr. Marek: The Minister can no longer hope for preferment from a discredited Prime Minister and it would do all civil servants a power of good if he stated that the possibility reported in the newspapers of a bash-the-taxman policy in the next Conservative manifesto would be resisted by him. Civil servants at the Inland Revenue are professionals who take a pride in their work and the last thing that they want is a bash-the-taxman policy in the next Tory manifesto. Will the right hon. Gentleman do his best to ensure that it does not appear?

Mr. Luce: When the historians come to judge the 1980s and early 1990s, I believe that they will praise my right hon. Friend the Prime Minister for her remarkable leadership. They will realise how alive the Conservative party was in the 1990s and how much its members were looking forward to serving the country in the future, compared with the sterile members and policies of the Labour party.

Agencies

Mr. David Martin: To ask the Minister for the Civil Service what assessment he has made of the effect on the quality of public sector services of the establishment of agencies.

Mr. Luce: Improved service is one of the most important benchmarks by which the success of the next steps initiative will be judged. Results from the early agencies are promising.

Mr. Martin: Does my right hon. Friend agree that the quality of service promoted in the next steps programme is wholly consistent with the Government's drive to improve

the quality of life in the areas affected by these services for those who work in them and, equally important, for the customers?

Mr. Luce: My hon. Friend hits the nail on the head. One of the main objectives of the next steps programme and the reforms is to ensure that the service provided to the public by the civil service is strengthened still further and that the quality of the service is even better. As we look to the 1990s, that is our clear priority. Evidence is coming in already that the agencies, ranging from Companies House to the laboratory of the Government chemist, and including HMSO and many other organisations, are providing an improving service and that high priority is given to the customer.

Mrs. Mahon: Does the Minister accept that computerisation of the benefit system has caused great problems for the staff and that, far from staff reductions, the 23 managers of the system agree that staffing levels should be increased? Current problems include giros not being paid on time, specialist benefits not being dealt with and money from the social fund, designed to make crisis payments for cookers and the like, not being paid out on time.

Mr. Luce: That is a matter for my right hon. Friend the Secretary of State for Social Services and the hon. Lady will be aware that my right hon. Friend is paying great attention to the way in which we can improve the services through that system. An agency is to be established next year which will strengthen still further the prospects for a better service.

Mr. Soames: Does my right hon. Friend agree that not only the conditions for those who consume the agencies' services but the terms and conditions of the employees have been improved? Will my right hon. Friend give every consideration to the Paymaster General's office in my constituency where the management would greatly welcome an early move in to the private sector?

Mr. Luce: I am grateful to my hon. Friend. We must, of course, draw a distinction between agencies remaining under the control of Secretaries of State and privatisation. There is increasing enthusiasm on the part of the staff in those agencies—hence their success stories. The potential for staff terms to be improved is considerable as a result of more flexible pay, individual performance bonuses and, in some cases, group performance bonuses.

Civil Service (Conditions of Employment)

Mr. Skinner: To ask the Minister for the Civil Service when he next expects to meet the civil service trade unions to discuss changes to the civil service conditions of employment.

Mr. Luce: I refer the hon. Member to the reply that I gave earlier to the hon. Member for Stoke-on-Trent, Central (Mr. Fisher).

Mr. Skinner: The next time the right hon. Gentleman sees the civil service trade union leaders, will he tell them that to get rid of the double standards regarding civil servants and Ministers taking jobs in outside industries top civil servants will be stopped from taking such jobs? That is the best around the problem and would be appreciated by the millions outside this place. A ban on such


appointments should not apply for two years only, and Cabinet Ministers should be treated in the same way. It would also not be a bad idea if every Member of Parliament had one job, and one job only. The moonlighting should be stopped.

Mr. Luce: We are talking about people who have retired from the civil service or retired Ministers. The hon. Gentleman does not do justice to the fact that many of

them have talents to offer the country. Just as many Labour ex-Ministers—[Interruption.] I do not know whether the hon. Gentleman agrees, but Lord Glenamara, Lord Robens, Lord Marsh and many others, whose talents were available, have served in the private and public sector. So long as propriety is maintained—that is the rule with the civil service—those talents should be available to the private sector.

Ozone Layer (London Conference)

The Secretary of State for the Environment (Mr. Chris Patten): With permission, Mr. Speaker, I should like to make a statement about the outcome of the second meeting of the parties to the Montreal protocol on substances that damage the ozone layer, which the United Kingdom hosted and chaired in London last week under the auspices of the United Nations Environmental Programme and which was opened by the Prime Minister.
I am delighted to say that the agreement reached at the meeting marks a major step forward in the global effort to deal with the ozone problem. The parties agreed that chlorofluorocarbons should be phased out by 2000, with intermediate cuts of 50 per cent. compared with 1986 levels by 1995, and 85 per cent. by 1997. We also agreed that halons should he phased out by 2000, except for agreed essential uses, with an intermediate cut of 50 per cent. by 1995.
Those two agreements represent a substantial tightening of the controls in the protocol. Before the London meeting the only requirements were a return to 1986 production and consumption levels by 1989–90 for CFCs and 1992 for halons, and a 50 per cent. cut for CFCs by 1998–99. Controls on two other ozone-depleting chemicals—carbon tetrachloride and methyl chloroform—were also agreed. Use of carbon tetrachloride will be phased out completely by 2000, with an intermediate cut of 85 per cent. by 1995. Use of methyl chloroform will be reduced to 30 per cent. of current levels by 1995 and 70 per cent. by 2000, and it will be phased out completely by 2005. Neither of those chemicals was controlled under the protocol previously.
Despite that tightening, several countries, including ourselves, would like to have gone further and faster. In particular, a number of countries argued that we should ban CFCs by 1997. We think that this would be a wholly acceptable target provided that there was an exemption for essential medical uses—for example, medical aerosols. We shall be pressing the European Commission to bring forward an amending regulation to provide for this within the Community as soon as possible. We shall be returning to this issue on a global basis in 1992—the parties agreed that there should be a review of the CFC controls then, with the aim of accelerating the phase-out schedule.
We also reached agreement on a financial mechanism under which developed countries will meet the incremental costs that developing countries incur in complying with the protocol, and on the technology transfer that will be necessary to enable developing countries to do so. Governments cannot simply guarantee that technology will be transferred, because they do not own the technology. But provision was included in the protocol so that if a developing country feels that insufficient financial support or transfer of technology threatens its ability to comply with the protocol's provisions it will be able to discuss this issue with the other parties to find a solution.
The outcome of the London meeting is a unique achievement in environmental diplomacy. Never before has the international community reached agreement on this sort of package. It brings together tight controls on chemicals which have previously played a vital role in our economic development, financial support for developing

countries, and a commitment to helping those countries adopt and adapt to the new technology that has to be employed in making and using substitute chemicals.
The fact that nearly 60 countries from the developed and developing world succeeded in reaching agreement on this issue, and that the Indian and Chinese delegations both said that they would recommend to their Governments that they join the protocol, marks a new phase in international co-operation on major environmental issues. I believe that, having reached agreement on the ozone problem, we can now move on and try to reach agreement on the other more difficult environmental problems that we face, such as global warming.

Mr. Bryan Gould: The agreement reached last week was an important and welcome step towards the long-term protection of the ozone layer. To the extent that the Secretary of State, as chair of the conference, made his contribution to that outcome, he deserves our congratulations, and the Opposition are glad to offer them. It is particularly welcome that China and India have been brought within the Montreal protocol. I am also pleased that the principle of a fund and financial help to the third world has been established.
Does the Secretary of State agree that the agreement, welcome though it is, does not of itself save the ozone layer? Does he accept Dr. Joe Farman's view that the ozone layer will still suffer a further 20 per cent. destruction by the year 2000? Does he agree with the United Nations working group that every 1 per cent. loss of ozone leads to a 3 per cent. increase in skin cancers and a further 100,000 people going blind?
What is the Secretary of State's estimate of the volume of ozone-depleting gases that will be released between now and the year 2000? Does he agree with the Greenpeace estimate that it will represent half as much again as the total amount already released in the whole of recorded history up to the present?
Is the Secretary of State satisfied that enough help has been offered to the third world, particularly in relation to technology transfer? Will he say more about how the fact that that technology is largely privately owned is to be circumvented? While the British Government's offer of £9 million to the fund is welcome, that must surely be seen in perspective. Is not it the case that it represents just one fifth of the amount that the Department of Energy is currently spending on consultants' fees in the run-up to electricity privatisation?
While the Secretary of State clearly did well in his role as chair of the conference—[Horn. MEMBERS: "Chairman."] I am replying, and I shall choose my language. While the Secretary of State did well in his role as chair, will he acknowledge that the position of the British Government left something to be desired? I refer especially to the mystery of why we are unable to add our signature to the declaration which commits 14 other countries, including all the other members of the European Community, to phasing out these gases by 1997. Is it really true, as his hon. Friend the Minister of State maintains, that we were simply not asked to sign? If it is true that we were excluded in such a way, is not it a rather wounding insight into our image as a country which is always expected to drag its heels and to act on the side of delay?
What are the special medical uses that prevent us from agreeing to a 1997 phase-out, and how are other countries, which have agreed 1997, managing in that respect? How


will we ensure that we meet the deadline? Will building foam containing CFCs, for example, be banned? If so, when? Will the chosen instruments be prohibition, or a price mechanism, as recommended by the Pearce report? What support will be given to the recycling of CFCs and what safe methods of disposal will be adopted?
Does the Secretary of State acknowledge that green consumerism has been an extremely valuable ally in reducing the use of CFCs, but that Government intervention is now required? I assure him that he will have the Labour party's support for any measures that are put in place now.

Mr. Patten: I thank the hon. Gentleman, parenthetically, for his kind parenthetical observations.
It will probably take the next half century to save the ozone layer. Under the previous protocol, it was estimated that chlorine loading in the atmosphere would rise from today's level of 3.5 parts per billion to about 5.9 parts per billion by the year 2040. Under the terms of the new, tighter protocol we are talking about an increase which will peak at just over present levels in 1997, and will then fall towards the year 2040. Levels should fall to about three parts per billion by the year 2040 and continue to fall thereafter. We may be able to achieve a better result, but that will obviously depend on whether we can encourage others to tighten up regulations and targets in the way we would like. Those estimates are on the pessimistic side.
Nevertheless, we expect substantial improvement in chlorine loading, which will fall back to the levels that existed before the hole in the ozone layer above the Antarctic was discovered. We expect a substantial improvement, but it will take quite a long time.
The hon. Gentleman asked whether we were providing enough help. Our contribution to the interim fund for the next three years is based on the United Nations formula. No one at the conference did not welcome the contribution that we were proposing. I have no doubt that after the interim fund ends we shall be considering a further longer-term fund, which will provide financial assistance. We also want to ensure technology transfer as far as we can, but that tends to be a curious portmanteau expression used to describe things which are tradeable. Under the existing aid programmes, technology transfer is encouraged: licensing agreements, technical co-operation and training programmes, and the purchase of patents are all funded by aid.
The hon. Gentleman was wrong in his remark about the United Kingdom Government's position compared with that of the rest of the European Community. Four member states of the Community signed the statement to which the hon. Gentleman referred, not 11. Among those countries that did not sign and do not have their names on the statement to which the hon. Gentleman referred are France, Italy and the Republic of Ireland, which at the moment holds the presidency of the Community. We have no differences with the rest of the Community about wishing to phase out CFCs by 1997.
I suspect that one reason why we were not approached to sign the statement was that I was chairing the conference and trying to provide as broad an agreement as possible. Other member states may have concluded that it would be wrong to press Britain to take a partisan position

during the conference. Let there be no doubt that we are committed to phasing out CFCs by 1997, except for special medical uses.
The hon. Gentleman asked to what sort of medical uses I referred. I mentioned medical aerosols in my statement. If the hon. Gentleman knows anybody who suffers from asthma, he will rapidly find examples of medical aerosols.
I could refer to other issues involving toxicity testing and, alas, the fact that no alternative has yet been found for halons for use in aircraft, in manned computer centres or for putting out fires. There is also difficulty in producing enough of an adequate substance for use in refrigerators. However, I will not go into those matters in detail.
The hon. Gentleman is right to say that the Government need to encourage greater recycling. I was delighted when my hon. Friend the Minister for the Environment and Countryside opened the plant that Imperial Chemical Industries has started for that purpose. The hon. Gentleman is also right to say that green consumerism has helped a great deal. I hope that the green labelling scheme, which we are pressing in the European Community, will help in that and other areas. We look to European Community regulations to help the Government to achieve tougher and tighter targets. I shall be asking the next presidency of the European Community Environment Council to take urgent and early steps on that issue.

Sir Peter Emergy: Will my right hon. Friend accept the congratulations of the House on his chairmanship of the conference? I thank him for his reference to asthmatics, because, being one myself, I am aware that the issue is of great importance to them.
Is not it true that one of the greatest problems of chlorine in the atmosphere arises in European nations that we used to describe as being behind the iron curtain? Will my right hon. Friend ensure that the EEC considers giving assistance with the financial problems faced by those nations in dealing with the industrial problem, which is both great and severe?

Mr. Patten: I was extremely pleased that a number of central and eastern European countries were represented at the meeting in London last week for example, Hungary, Poland and Czechoslovakia. The European Community needs to give as much assistance as possible to countries in central and eastern Europe to enable them to cope with their environmental problems, and that includes the depletion of the ozone layer.

Mr. Peter Shore: I, too, congratulate the Secretary of State on making such welcome progress in phasing out CFCs and, in particular, on bringing China and India into the agreement. He would be the first to recognise that the crucial element in their agreement is that there should be an adequate transfer of technology. It is on that point that I feel that the position is not yet as clear or as definite as the House would wish. What discussions has the right hon. Gentleman had with companies such as ICI—there are few CFC producers in the United Kingdom—to obtain their agreement to the necessary transfer of technology, either through establishing subsidiaries in the case of India, or through licensing agreements in other cases?

Mr. Patten: The right hon. Gentleman is right, and I thank him for what he said about the difficulties of


ensuring adequate top technology transfer. One important element in the agreement is that it brings together the issues of compliance and of technology transfer in a way that is acceptable not only to developed countries but—and it is slightly more to the point in this context—to developing countries. The Government have had a number of discussions with ICI, just as Governments of other countries have had discussions with their chemical producers. With reasonable good will on the part both of the firms concerned and of developing countries, it should be possible to get round some of the difficulties that the right hon. Gentleman identified.
For example, as part of our aid programme—it was part of an aid agreement that I signed with India last year—we have already done an extremely good study on the costs to India of CFC substitution and ways in which we should set about helping it to meet those costs and deal with the necessary technology. It involves a number of elements, not least how early the Indians can take action, and how much they can do to promote recycling. I have no doubt that companies such as ICI are keen to discuss with Governments such as the Government of India how they can transfer technology in a way that does not discourage them from investment in substitution.

Mr. Anthony Nelson: I join in welcoming my right hon. Friend's statement and the personal commitment that preceded his chairmanship of this important conference in London. I also welcome the fact that both India and China have been brought in, and the opening that he announced for even more rapid progress over the next decade or so.
My right hon. Friend has already acknowledged that the consumer movement played a large part in paving the way to the conference. What advice, apart from the labelling scheme, would he give to consumers, recognising that the responsibility for reducing the use of ozone-depleting chemicals rests not just with Government but with household consumers and buyers?

Mr. Patten: I am grateful for what my hon. Friend has said. It is important to pay tribute as well to the work of the United Nations Environmental Programme in general and to Dr. Tolba, the executive director, in particular. He did an admirable job in moving along the discussion in the past few months and in getting us to the situation in which we could reach agreement last week.
Consumers have helped, through the pressure that they have brought to bear, to ensure the more rapid phasing out of aerosol sprays. I hope that consumers will turn their attention to recycling, for example, of CFCs in refrigerators. They can ensure that, when they replace their refrigerator, if possible, their retailer takes back their old regrigerator and has the CFCs contained in it adequately recycled through one of the schemes.

Mr. Simon Hughes: The international agreement and the level of it are welcome. It is appropriate that there has been a unique agreement, given the uniquely severe and urgent problem. However, the Secretary of State has failed to achieve his targets, as set out in his press release of 14 June, in which he said that the objective was to achieve the most rapid possible cuts in and consumption and the most demanding timetable for reduction of CFCs. We should have set an example. We

should have said that we were committed to a 1997 phase out at worst, or even one in 1995, and even allowing for the exemption on medical aerosols.
Given that many of us feel, like Joe Farman, who discovered the ozone hole above the Antarctic, that the results of the conference were very disappointing, will the Secretary of State look again at the Government's policy of blocking in the Commons the Bill promoted by my noble Friend Lady Robson that got through the other House? Will they introduce in this House in the next Session of Parliament a Bill that commits us to the most urgent possible target for the elimination of CFCs?

Mr. Patten: I hope that we shall be committed, with agreement on the European Community regulation, to phasing out by 1997, with the qualification that I mentioned earlier. I do not think that the hon. Gentleman, while properly stressing the urgency of this issue, should overlook some of the real problems in providing substitution, one of which is adequate toxicity testing. It is simply not good enough, for example, to tell people in electronic engineering who are using solvents that they should use alternatives that have not yet been properly tested. That would not be reasonable. There are other problems, to which I have already referred, relating to halons, and the medical arguments. These are not being paraded as excuses for inaction, but are being pointed to as reasons why we cannot go even faster. Anybody in his right mind would want to get rid of CFCs tomorrow.

Sir Antony Buck: Is my right hon. Friend aware that it is gratifying that he is receiving accolades from Members on both sides of the House for what has been achieved? Will he say a word or two about the methods of monitoring and enforcement of what has been agreed?

Mr. Patten: Of course. Monitoring and regulation are extremely important parts of the protocol. A special committee will be set up under the terms of the protocol, comprising some of the countries that agreed to it, which will be responsible for monitoring compliance with the protocol. In addition, we shall have our own reporting procedures within the European Community to make sure that we achieve the targets. My hon. and learned Friend is entirely right in noting that one of the major considerations in all environmental diplomacy will be making absolutely certain that, having signed agreements, people keep them. I suspect that that will become an even greater problem when we start discussing other greenhouse gases.

Mr. Alan W. Williams: I join in congratulating the Minister on the further progress that has been made in the new agreement. Will he answer the question asked by my hon. Friend the Member for Dagenham (Mr. Gould) about the comments of Dr. Joe Farman that, even under the new arrangements, ozone depletion will continue and the ozone layer around the northern hemisphere over Britain and the United States will decrease by 20 per cent. by the year 2000? When we talk about phasing out CFCs by the year 2000, are we not in a similar position to a smoker who smokes 100 cigarettes a day and is told to give up because he risks getting cancer? Should not there be much greater urgency


internationally towards phasing out by 1995 or 1997? Frankly, if we had any sense, we would stop using those products virtually straight away.

Mr. Patten: Although metaphors are valuable in political debate, the hon. Gentleman's chosen metaphor is not wholly accurate. Speaking as a former smoker, I found it possible to go from smoking 30 cigarettes a day to zero overnight, encouraged by the existence of two ulcers. CFCs are rather a different issue.
Although it would be nice to stop any use tomorrow, that is not possible, but we have introduced new and much tougher targets. I hope that when we review those targets in 1992 we shall be able to toughen the ones that we agreed last week still further. I pointed out earlier that the new agreement would mean that chlorine loading in the atmosphere would peak by 1997 and start to fall thereafter. Under the previous protocol we were talking about chlorine loading increasing from 3.5 to 5.9 parts per billion by the year 2040. However, even if we were to stop using CFCs now, we should be talking about the problem for some time in future because of the concentration of chlorine in the atmosphere. It will take quite some time to deal with that extremely important and difficult problem.

Mr. Andrew Mitchell: I congratulate my right hon. Friend on the excellent agreement, and, in particular, on the attachment of China and India to it. At a more mundane level, will he bear in mind the importance of continuing to encourage local authorities such as Gedling to look for ways of setting up a system of reclaiming domestic fridges and large industrial freezer units which contain damaging gases which would otherwise be released into the atmosphere?

Mr. Patten: I very much agree with my hon. Friend. Local authorities which have taken the action to which my hon. Friend has referred are to be warmly congratulated. I hope that many more will follow their example, and, as I said earlier, that retailers will do all that they can to promote recycling.

Mr. Andrew F. Bennett: Will the Minister tell us exactly when we will get the Government system of green labelling? If the EEC is still dragging its feet, could not we ensure that all ozone-damaging products are clearly labelled as such when they are sold in Britain and when they are exported so that consumers can move rather faster than the Government and other international groups?

Mr. Patten: I think, not least because of the creation of the single market, that there is a strong argument for a Europewide scheme of green labelling. We have been pressing for that, and I should like to see one agreed and, if possible, established by the end of next year. If we do not make such progress on a Community level, we shall have to introduce our own scheme for this country. It would be better if we had a scheme that applied across the Community.

Mr. Simon Burns: Does my right hon. Friend accept that one of his achievements has been in harnessing the international community to produce an agreement that is more far reaching than many people thought could be achieved? He has confounded and

wrong-footed the professional moaners who carp about things being too little, too late. Notwithstanding the monitoring and reporting systems in the agreement, are there any more precise safeguards to ensure that countries cannot backslide on keeping to the agreed deadlines?

Mr. Patten: The protocol provides adequate safeguards on backsliding. As I said to the right hon. Member for Bethnal Green and Stepney (Mr. Shore), it will be possible for countries that believe that they are not receiving adequate help with technology transfer through the financial mechanism to take the issue back to the other parties under the protocol, which is reasonable.
In the next few years, environmental diplomacy will raise issues of the greatest sensitivity to individual countries. It will draw attention to the different judgments that countries make about these matters and the problems that they face. We shall achieve the agreements that we need only if we start diplomacy without grandstanding or slagging one another off. These issues must be handled with humility on all sides.

Mr. Jeremy Corbyn: May I take the Minister back to the reply that he gave my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) on the important question of technology transfers? To many, it appears that there is a dangerous loophole in the agreement, because the technology is held by a few multinational companies. Developing countries which understandably wish to promote the development of refrigerator-making industries and so on will have to pay much for that technology, unless they apply to an as yet unquantified fund held by the Commission or the convention.
Will the Minister assure us that there wil be no delay in ensuring a rapid transfer of technology, for example, to allow the Indian Government to promote the building of a new refrigerator plant, which is now planned, using non-CFC material rather than the obviously dangerous CFCs? If this loophole continues, many of the achievements in getting people together will be weakened, if not destroyed altogether.

Mr. Patten: The fund is not unquantifiable. We have agreed on a figure for the interim three-year-old period of S240 million, including resources for India and China. Subsequent commitments to the fund may need to be much more substantial, depending on the progress that we make and on the precise costs of CFC substitution.
As I said earlier, the expression "technology transfer" tends to be used rather loosely, ignoring the fact that when talking about technology transfer one is talking about items which are tradeable, which are sold between one company and others or between one country and others. I suppose that that is a rather confusing concept for some Opposition Members—I do not mean to be offensive—who would argue that the multinationals should be nationalised; socialism is still on one country's agenda. It should be possible, with a modicum of good will, to overcome the problems identified by the hon. Gentleman through licensing agreements and joint ventures. There are plenty of examples of those agreements being funded within our existing aid programmes; I concluded one or two in a more benign past.

Several hon. Members: rose—

Mr. Speaker: Order. I have an obligation to protect the business. There is to be a debate on a Select Committee report on aid to eastern Europe. Some of those hon. Members who are rising seek to take part in it, so I shall allow two more questions from each side of the House. We must then move on. Undoubtedly we shall return to this subject.

Mr. Kenneth Hind: My right hon. Friend referred to the fund and will be aware of the comments by the Indian Government about the shortage of funds. He has presided over a major achievement. Will he comment on the size of the fund that will result from his achievements at the conference and on the adequacy of the fund for countries such as India if they are to be able to meet their requirements under the protocol?

Mr. Patten: As I said, the size of the interim fund is about $240 million over three years, but we expect further contributions to a fund after that. Under an aid agreement with India which I signed last year, we have promoted a study of the costs of CFC substitution in India. The distinguished Indian Minister, Mrs. Gandhi, who made a substantial and distinctive contribution to our discussions last week, referred in some press interviews to a cost of $340 million for CFC substitution programmes in India. That is the highest figure suggested by Touche Ross, which suggested in its report that, with earlier action and more recycling it might be possible for the Indians to cope with the CFC substitution problems for $120 million. I guess that somewhere between those figures there is a realistic amount which the Indians will need to comply with the protocol. What delighted me almost more than anything else was the fact that India and China reckoned, at the end of a fortnight's argument and discussion, that they could bring themselves to agree to the terms of the protocol.

Mr. Gavin Strang: I acknowledge the contributions by the Prime Minister and the Secretary of State to this historic international agreement on a major environmental issue. I put it to the right hon. Gentleman that the effect of the implementation of the protocol by India and China will be crucial. To many Opposition Members, the right hon. Gentleman's remarks about the transfer of the technology of the production process to these developing countries could have been more robust. Surely we will not allow the multinational companies to drag their feet. The sums of money that will be given to India and China in the short term are relatively small. I hope that the right hon. Gentleman agrees that it would not be acceptable to us if they used that money to buy CFC substitute products from advanced economies.

Mr. Patten: It is worth noting that the substitutes for CFCs were not discovered by politicians and will not be marketed by Ministers who sign agreements. They were discovered and will be marketed by the same multinational companies that are still some of the villains in the Opposition's arguments. I do not see the companies concerned in that light. ICI has behaved with commendable public spiritedness. Like the rest of us, these companies want CFC substitutes to be used to ensure that we can enjoy the benefits of economic and social progress without depleting the stratospheric ozone.

Mr. D. N. Campbell-Savours: What measures are in the protocol to deal with the destruction of exhausted air-conditioning and refrigeration equipment

in China, India and the countries throughout the far east which have very hot climates? What will happen to the equipment that must be destroyed? Will those measures be funded?

Mr. Patten: As I said, the study on India, which we helped to fund, referred to the considerable progress that could be made by the encouragement of precisely the sort of recycling to which the hon. Gentleman referred. One of the first steps that we must take with all developing countries is to agree on a realistic programme for both CFC substitution and recycling. The potential impact that those countries' economic development could have on the problem if we do not assist them makes one realise how important it is to give them all the help that we possibly can.

Mr. Ian Bruce: Will my right hon. Friend confirm that CFCs are used so widely because of their non-toxic and non-flammable properties? Will he confirm that, while protecting the ozone layer, the Government will make absolutely sure that they protect factory workers and other citizens against possible less safe substitutes?

Mr. Patten: My hon. Friend is quite right. The importance of taking precautions is relevant to CFC substitution, as it is to other matters. The damage that was done inadvertently by the invention, manufacture and use of CFCs, which were initially regarded as a great scientific breakthrough, should make us particularly cautious in respect of the testing that is required for CFC substitutes. That is why I stressed toxicity testing.

EUROPEAN COMMUNITY DOCUMENTS

Ordered,
That European Community Document No. 10139/89 relating to municipal waste water treatment be referred to a Standing Committee on European Community Documents.—[Mr. Patnick.]

STATUTORY INSTRUMENTS, &c.

Mr. Speaker: With the leave of the House, I will put together the Questions on the two motions relating to statutory instruments.

Ordered,
That the Rent Book (Forms of Notice) (Amendment) Regulations 1990 (S.I., 1990, No. 1067) be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the Rent Officers (Additional Functions) (No. 2) Order 1990 (S.I., 1990, No. 1068) be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Patnick.]

Mr. Corbyn: On a point of order, Mr. Speaker. We all realise the pressure of business, but we have just had an important statement on an issue that affects the future of the planet. Only two more hon. Members wished to ask questions—

Mr. Speaker: Order. I know. It would be very tempting to call all those hon. Members who rise on questions and statements.

Mr. Corbyn: But it was only two.

Mr. Speaker: Many other hon. Members wish to take part in today's debate. Even if I could impose a 10-minute limit on speeches, I should not be able to call all those who wish to participate. The House must accept that it is only fair to give hon. Members who wish to take part in the main debate the opportunity to do so.
Two Opposition Front-Bench spokesmen will be making speeches, and if they set a good example to the rest of the House I may be able to call a good many—though perhaps not all—of those hon. Members who wish to participate. Again, I ask for brief speeches.

ESTIMATES DAY

[1ST ALLOTTED DAY, 2ND PART]

ESTIMATES 1990–91

Foreign and Commonwealth Office

EASTERN EUROPE

[Relevant documents: Third Report from the Foreign Affairs Committee of Session 1989–90 on FCO/ODA Expenditure 1990–91 (House of Commons Paper No. 233).

European Community Documents Nos. 9090/89 on Aid to Poland and Hungary and 10788/89 and 4542/90 on medium term financial assistance for Hungary.]

Class II, Vote 2

Motion made, and Question proposed,

That a further sum, not exceeding £74,290,000 be granted to Her Majesty out of the Consolidated Fund to defray charges that will come in the course of payment during the year ending on 31st March 1991 for expenditure by the Foreign and Commonwealth Office on grants and subscriptions etc to certain international organisations, certain grants in aid, special payments and assistance, scholarships, Military aid and sundry other grants and services.—[Mr. Waldegrave.]

Mr. David Howell: The Select Committee on Foreign Affairs is grateful to the House for giving us this opportunity to discuss the Committee's third report on Foreign and Commonwealth Office and Overseas Development Administration expenditure, and to focus particularly on matters relating to assistance to eastern Europe. The sections of the report dealing with the know-how fund and support for eastern European economic development will be the main focus of attention. It is worth pointing out, however, that the other issues raised in the report relate directly to what is happening in eastern Europe and to the whole range of other issues of concern to the House, including environmental pollution, which we have just discussed.
Paragraph 7 of our report examines the problems of Foreign and Commonwealth Office staffing, which have arisen because of the need to establish stronger posts and a greater effort in the new democracies of eastern Europe. Some changes in the dispositions and staffing policies of the Foreign Office have already been announced and it is clear that further changes will be needed if we are to meet those pressures.
In paragraph 9 of the report, we return to the subject of visa policy—a perennial problem and a frequent cause of complaint to those who visit eastern Europe, where the granting of visas to the United Kingdom is still too slow and there are too many unacceptable delays. We look forward to a time when the visa arrangements for eastern European countries are abolished. That would have to be achieved on a Europewide basis and I know that Ministers have been examining that possibility.
We considered the role of the BBC's World Service both generally and in relation to its role in the liberalisation processes in eastern Europe. The general view of the House would be that the World Service has performed wonders and that it has played an excellent role in assisting the process of democracy to emerge in eastern Europe and in establishing the work, role and reputation


of this country. I hope that all hon. Members will support me when I say that we hope that the financial problems facing the World Service in trying to catch up with inflation—admittedly, that is a problem we all face—can be satisfactorily resolved so that the highly worthwhile efforts and the very valuable return per pound spent through adequate support for the World Service are fully recognised in future.
The Select Committee considered the Wooding review into how we can encourage east European and Soviet studies in British universities. We expressed some disappointment and unease about the fact that, despite certain undertakings by Ministers, the full commitment to implement the review has not happened and there seems to be a certain amount of buck-passing who should find the funds to push the matter forward to ensure that we have adequate Soviet and eastern European studies in our universities. Above all, the Select Committee considered the work of the British Council and, in particular, its work in setting up offices in eastern Europe and encouraging English language teaching to ensure that English becomes the second language of eastern Europe.
The know-how funds are part of a much bigger jigsaw. The G24 advanced industrialised countries have already pledged about $13 billion in loans and credits to eastern Europe. That includes $2 billion for Poland and Hungary from Japan, $300 million from the United States and an enormous programme of activities, and support from the European Community to which we contribute directly. All that is embraced in the so-called PHARE—the Poland-Hungary assistance for the reconstruction of economies—system of support for eastern Europe. That is a wide-ranging and fast-developing set of programmes ranging from food aid in the short term to meet immediate emergencies in eastern Europe to vocational training, massive projects for cleaning up the environment—which are certainly needed in eastern Europe—raising loans for infrastructure, opening markets in western Europe for eastern European goods and a host of other developments. In addition, there is the European Bank for Reconstruction and Development which is to be located in London.

Mr. Dennis Skinner: The right hon. Gentleman has been talking for a few minutes and I had thought that with the passage of time some of his friends from the Select Committee might turn up to listen to him, especially as Mr. Speaker said earlier that quite a number of hon. Members wished to take part in this debate. I do not think that I am mistaken in saying that only one other member of the Select Committee is present to listen to the right hon. Member for Guildford (Mr. Howell). I wish to address my remarks through the right hon. Gentleman to the Chair. It is a bit odd that in this great debate for the general good and so forth, when we want to talk about the ozone layer there is only one other member of the Select Committee present to listen to the right hon. Member for Guildford. That says a lot about this whole panjangle.

Mr. Speaker: Order. The question was addressed to me. The object of these debates is to give hon. Members who are not members of Select Committees and other hon. Members who are not fortunate enough to visit these places an opportunity to express their views. Of course, the Treasury and Civil Service Select Committee has also recently returned from eastern Europe.

Mr. Howell: In the first two minutes of my speech I deliberately mentioned environmental pollution, two or three times, in the hope that the hon. Member for Bolsover (Mr. Skinner), whose views are greatly valued by the House—he is an expert on environmental matters and sought to intervene earlier—would be able to catch your eye, Mr. Speaker, and to develop his views at length. Hon. Members hope to hear from him on these issues because his views are relevant to eastern Europe and assistance to it.
All the programmes of assistance pale into insignificance when compared with the gigantic capital needs of eastern European countries. We are talking not about millions or billions of pounds, but about hundreds of billions of pounds, which will be needed to develop and improve the structures of eastern Europe. Those programmes will have to be financed, at least in part, from the resources of eastern European countries. Incidentally, it is encouraging to note that the East Germans already show signs of saving rather than spending their new-found deutschmarks. Other eastern European countries will need to do the same, but they will require large capital resources, which will put a huge strain on the capital systems of the west. If one is a little gloomy, therefore, one can expect rather high interest rates some way into the 1990s as capital is diverted to eastern Europe as the sums involved are absolutely huge.
In thinking about our assistance, we have been focusing on Poland, Hungary and Czechoslovakia, but a far greater problem stands behind them—that of the Soviet Union and what, if anything, can be done to meet the large and rapidly growing needs of that struggling, sinking and disintegrating society and economy. The needs are bottomless. There is an understandable view that the Soviet Union will have to stew for the time being, until it works out its new political order and gets some means of receiving and making use of assistance from the west which many people fear that it does not have at the moment.
I agree with those who say that simply throwing enormous sums of money at the Soviet Union in new loans and grants at this stage would probably be a complete waste and cause only temporary easement before the whole economy continued its downward path to penury.

Mr. Kenneth Hind: Does my right hon. Friend agree that, once the Soviet Union has shown the democratic direction in which it wishes to go, one of the beginnings of help could be the extension of the know-how fund to the Soviet Union, whereby we would use our initiative and managment know-how to encourage the development of private industry and private initiative, which would help to fight the shortage of consumer goods which patently exists within the Soviet Union at present.

Mr. Howell: My hon. Friend is absolutely right—once the Soviet Union shows the beginnings. The first beginning must be some currency and financial reform. In a sense, the Soviet Union needs a major currency union with the rest of the world—that would put it in a position to receive effective assistance from the west—through the creation of a hard rouble, just as East Germany has had a currency union with West Germany and received a hard currency so that it can attract investment and begin to develop. The only hope for the Soviet Union is the development of a hard currency, which would require vast international


effort and support. That subject is now being considered and ruminated on and possibly mobilised in the International Monetary Fund, the world bank and other circles.

Mr. Nicholas Budgen: Is my right hon. Friend really saying that it would be possible to lock all the great currencies in the world into some fixed mechanism?

Mr. Howell: I was not dealing with that fascinating aspect of the subject. I was merely indicating the virtue and necessity of a hard currency. I think that my hon. Friend would be the first to recognise that that is the only basis upon which one can begin to get economic growth. and reform. Without a hard currency, there is little hope of the Soviet Union being able to check its downward slide. Much as I should like to discuss aspects of exchange rate policy with my hon. Friend, who is an expert in such matters, my present proposition is no more adventurous than that which I have advanced.
Any western aid to the Soviet Union should be geared to changes of the kind that I have described. The goal is a hard currency. Meanwhile, suggestions by European Ministers of billions of dollars for the Soviet Union may be good rhetoric but will not have much effect.

Mr. David Tredinnick: Does my right hon. Friend agree that, although the Soviet Union has not embarked on the reforms that we agree are desirable to trigger resources, there might be a case for giving it an incentive in the form of limited aid from the know-how funds, perhaps to spread the English language to which he has already referred? Such a move would help the leader of the Soviet Union.

Mr. Howell: I shall deal later with the promotion of English as a second language. Anything that we can do in that respect would be valued in the Soviet Union and everywhere else, not just in a high-minded sense but because it would further the prosperity and interests of Britain. The other country that was in our minds at the weekend was East Germany—the German Democratic Republic.

Mr. Anthony Beaumont-Dark: Will my right hon. Friend give way?

Mr. Howell: Does my hon. Friend wish to ask a question about the Soviet Union?

Mr. Beaumont-Dark: Yes. Does my right hon. Friend accept that a great deal of sentimental twaddle is talked about Mr. Gorbachev and what he wants to do for Russia and for the world? Chancellor Kohl wants to invest £20 billion of the money of all of us in Russia to save Mr. Gorbachev. Until Mr. Gorbachev stops trying to improve communism and attempts to change the communist system, stops giving Cuba $5 billion of aid which he does not have and stops spending four times the amount that we spend on defence, why the devil should we give Russia money that it will use to beat us?

Mr. Howell: We do not necessarily want to save any individual politican, whether it be Mr. Gorbachev or anybody else—it is up to the Russians to decide whom they want to run their country. However, it is palpably

sensible to encourage reasonably bloodless democratic development in all the Soviet republics. If we fail to do that and leave the Soviet stew to bubble over, creating a chaos of tribal and national wars which will spread to central and eastern Europe, we shall create great trouble for ourselves. I agree, however, that we should not back individuals but should encourage the democratic process as best we can wherever it shows signs of growing.

Mr. D. N. Campbell-Savours: I agree with much of what the right hon. Gentleman says. Does he agree that many Soviet economists have argued against large quantities of western aid at this stage, if only because it would underpin Soviet institutions which they believe can be removed only by financial disciplines? We should recognise that and, if necessary, delay aid in the hope that in finally allocating it we can determine the nature of those institutions.

Mr. Howell: I agree with the hon. Gentleman, although I would put it a little more positively. Rather than saying, "Let us do nothing until," I would say, "Let us try to work with the many Soviet economists who think that financial reform is needed to see ways in which that reform can be underpinned by western aid." Until something like that happens, there is no point in underpinning or underwriting the present chaos and inefficiency. Money would simply be lost.
I have given way too often. That may count against me on your score board Mr. Speaker, although I hope not too severely. I shall now talk about eastern Germany, which is in the news and which is about to become one vast construction site as the bulldozer and the deutschmark move in. One must marvel at how in three and a half months the German bureaucratic machine has achieved miracles and installed in East Germany an entirely new currency system, entirely new networks of financial control and an entirely new VAT system. In effect, a new official structure is already up and running as of yesterday morning.

Mr. Skinner: And some inflation.

Mr. Howell: It is a fantastic development. Whether it will also produce inflation remains to be seen.
Britain should certainly keep a close eye on East Germany and consider giving it assistance and investing in it. A huge programme is now under way to privatise thousands of small firms and all the large firms, in an effort to break the key log jam—that of private ownership and the problem of who owns the property and title to firms, businesses and real estate in East Germany. A programme has been set up through which a public trustee, the Treuhandanstalt, with an international supervisory board which will include someone from the United Kingdom, will attempt to dispense land on a legal title basis and establish that any land purchased by new enterprises belongs to them and ownership will not be thrown into question. In that matter, the British have been invited to be involved in the most intimate part of the transformation of East Germany and I hope that we can play our part vigorously.
Hope for East Germany turns on achieving the right balance between keeping wages low enough to attract investment without causing strikes, pressures and anger or making immigration to the west resume as people see higher wages over the way, and setting wages too high,


creating massive unemployment as whole industries are wiped out because they are uncompetitive. The Germans must get that balance right. If they do, and as they do, we should be able to help them.
The picture in eastern Europe is of a whole range of new countries striving for a free market, privatisation, liberalised trade and free enterprise. Of course, expectations are miles too high. It is believed that, as in East Germany this weekend, the magic of currency reform and pouring concrete can somehow change living standards, but it will not happen overnight. The House will agree that for our own commercial interests we must be closely involved in that process. Eastern European countries are not faraway countries of which we know nothing but our next-door neighbours in the European land mass.
What are the United Kingdom's interests? What is our role, and how can we strengthen it? The estimates report from the Select Committee attempted to address those questions and gave three categories of answers. The first related to personnel and language teaching. We should recognise that British professional personnel such as accountants, managers, administrators and even, I fear, lawyers are in huge demand in eastern Europe. Perhaps we could export a few lawyers from here. There is a tremendous feeling in eastern Europe that the British professional services can provide the habits of administration and ways for countries at last to get going again as free economies. As we point out in paragraph 42 of the report, there is great demand for British expert consultants to advise on the reorganisation of industries, businesses, utilities, and so on. Here I must declare an interest as energy adviser to a leading firm of British consultants involved in eastern Europe. I declare both an interest and some knowledge that the demand for their services is great.
On the language side, there is a world to conquer. As my right hon. Friend the Foreign Secretary said, we have the opportunity to make English the second language of eastern Europe. The Russian textbooks and grammars are being carted out of the classrooms and there is a call to bring in English teachers, books and teaching methods. The British Council told the members of the Select Committee that it foresees the need for 100,000 English teachers over the present decade, with 20,000 in Poland alone. It would be crazy not to respond to that demand as vigorously as we possibly can, even if it means switching resources from other areas. As I have said, the first category is people and languages.
The second category is private investment flows, which will follow language familiarity, expertise and administrative and legal reform. There, too, we must play our part. At present, West Germany is leading the pack in almost every country, and especially in East Germany.
The third category is our part in the multilateral support efforts that I have already mentioned. These will be made through the European Community, the European regional development fund, the International Monetary Fund and sensible programmes of debt reduction. We cannot continue with the line that the countries of central and eastern Europe should be asked to swim into the deep water of democracy and free markets while wearing concrete collars of impossible debts. I refer to the debts which were run up in the past by the communist regimes. There is a case for recognising the difference between debts incurred by incompetent communists in the past and the

need for those countries to strike out without seeing all their foreign currency disappear in debt servicing at every stage. We must adopt a balanced approach.
I hope—the Select Committee had this hope after considering the issues—that the opportunities in eastern Europe will be fully recognised. In due course we might look to the Government for a comprehensive statement on the United Kingdom's strategy in terms of the fantastic and unfolding drama of eastern Europe. Eastern arid central Europe are part of our culture and we can learn much from them. We should not assume too patronising a stance. In other words, we must not assume that the learning is all one way. We have a great deal to learn from the skills, energies and genius that are to be found within the central and eastern European countries. In eastern Europe we are looking at a vast and developing market of about 120 million people, most of whom are highly skilled. As a trading nation, we must be firmly established in that market. I hope that the comments in the report and my comments this afternoon will be of some small help in that direction.

Mrs. Ann Clwyd: I welcome some of the remarks of the right hon. Member for Guildford (Mr. Howell), but he would not expect me to be in agreement with everything that he has said. I associate myself and my right hon. and hon. Friends with his remarks about the BBC World Service. We are all conscious of the excellent job that it does with only limited resources. It is essential that its resources are strengthened to take into account the important extra work that it will be called upon to undertake.
Any discussion of assistance to eastern Europe must be seen against a backcloth of some of the most startling political and economic changes that have been seen this century, with countries moving from central planning to social democratic market-oriented economies. In eastern Europe there is excitement, uncertainty and some chaos, but everywhere there is hope. Britain, along with other countries that are giving aid, must take account of several developments that are, or will be, common to each country in eastern Europe. They include the creation of pricing systems and mixed economies that are based in part on private ownership and enterprise, the creation of capital markets, movement towards currency convertibility and the opening of internal markets to foreign competition.
We must be sure also, as the right hon. Member for Guildford said, to take account of the differences between the various countries—differences in history and tradition and in how the revolution was brought about in each country. That means that the pace and type of reform and the role of the western donors will vary from country to country.
We have all been shocked by the sight of Romanian orphans dying from AIDS, Soviet citizens queuing for hours just for a loaf of bread and Polish factories poisoning the air and water for miles around. I was glad that, earlier, the Secretary of State for the Environment made particular mention of the assistance that will be given to improve the environment in eastern European countries. The damage to the environment caused by old, inefficient industrial processes has been immense. In Hungary, even if further pollution by chemicals stopped tomorrow, chemicals would still flow through the water


table for the next 80 years. In East Germany and Czechoslovakia, unsafe nuclear power stations and energy production from lignite—a polluting brown coal—threaten the environment. It is therefore essential that aid responds to the needs of those countries for a better, cleaner and safer environment.
The Labour party is pleased to note that the forthcoming know-how programme for East Germany will include advice from Britain on decommissioning clapped-out nuclear power stations. I sincerely hope—I was pleased to note that the Secretary of State for the Environment also touched on this—that eastern Europe, unlike some other developing countries, will receive only the cleanest and up-to-date technology from Britain. In India, for example, British aid paid for British companies to build power stations without sulphur-cleaning flues. As a result, those power stations are now causing acid rain.
The scale of aid is bound to be considerable, but the resources must be found. The annual report of the United Nations Economic Commission for Europe looked at a possible Marshall plan for eastern Europe that would cost some £17 billion for four years. In January, the European Community outlined a programme that would cost about £14 billion a year. It is a tragedy that sums of that order seem to be too big and too challenging for the Government and the Prime Minister to take on board. The pace of change is simply too much for them. The Prime Minister, in particular, is out of sync and out of sympathy with the needs and challenges of the age in which we live.

Mr. Budgen: Is it the Labour party's policy to press for such expenditure? No doubt it would be welcomed in many quarters in Europe and it might be politically attractive in this country. If that is the Labour party's policy, by how much is our contribution to the EEC likely to go up as a result?

Mrs. Clwyd: As the debate develops I shall answer all the hon. Gentleman's questions. If he cares to spend a little money on purchasing the Labour party's new policy document, he will find that the Labour party supports the idea of a Marshall plan. As my speech develops he will also learn about the other things we support, but he will be aware that we are in favour of contributing 0·7 per cent. of gross national product to overseas aid. We intend to achieve that target in the first five years of a Labour Government.
It is a tragedy that the sums of aid needed appear to upset the hon. Member for Wolverhampton, South-West (Mr. Budgen), especially as I shall seek to prove that they need not hit the British taxpayer's pocket.

Mr. Beaumont-Dark: Where will the money come from?

Mrs. Clwyd: If the hon. Gentleman can contain himself, he will find out.
There are limits on resources and none of us would pretend otherwise. It is imperative, however, that aid, whether in the form of grants, know-how, equity financing, joint ventures or balance of payments support, should be carefully targeted. It should be used to build the structures to ensure that funds are productively used so that loans generate long-term revenue.
It is precisely because resources are scarce that third-world countries are anxious that the ideological

political pressure for reform in eastern Europe should not encourage western countries to give those countries aid at the expense of the third world. In short, the aid given to eastern Europe must be in addition to that given to the third world. I hope that the Minister can clarify the position by assuring us that aid to eastern Europe will not be at the third world's expense, not just this year—we have already had some assurances about that—but in the years to come.
It is not surprising that third-world countries fear that more aid from Britain to eastern Europe means less for them because they have seen the Government renege on their aid commitments every year since 1979. Far from meeting the United Nations overseas aid target of 0.7 per cent. of GNP, Britain's contribution has fallen to less than half of that target. If the aid had remained at the level achieved when the Labour Government left office in 1979, the third world would be £8 billion better off than it is today. I am glad to note that the Select Committee on Foreign Affairs strongly recommends that the Government should set a timetable for achieving the UN target. Only by doing so can the Government genuinely demonstrate that aid to eastern Europe is not preventing Britain from meeting its commitments to the poorest countries.
Regrettably, the record of aid to eastern Europe so far shows that the performance of the British Government and British industry is far from impressive. One of the stumbling blocks is the Prime Minister, who, despite her love-ins with President Gorbachev, has been slow to realise the significance of what is happening in eastern Europe. Ideologically blinkered, the right hon. Lady has even had the nerve to criticise West Germany and France for providing credits to the Soviet Union. She seemed to fall in line only after President Bush had had to intervene.
Ministers, led by the Prime Minister, too often view the problems of eastern Europe as opportunities for photo-calls rather than for action. Goodness knows how the embassy in Hungary copes, because, by the end of this year, no fewer than 22 British Ministers, including the Prime Minister, will have visited that country. Not to be outshone, the right hon. Member for Henley (Mr. Heseltine) has been there, too.

The Minister of State, Foreign and Commonwealth Office (Mr. William Waldegrave): Would the hon. Lady care to remind us about the number of Opposition Members, as well as Opposition Front-Bench spokesmen, who have also been to the embassy?

Mrs. Clwyd: Obviously I cannot speak for my hon. Friends, but I am sure that those who contribute to the debate, including members of the Select Committee on the Treasury and Civil Service, will be ready to tell the right hon. Gentleman about their experiences. I cannot understand why 22 British Ministers felt it necessary to visit the embassy in Hungary.

Mr. Waldegrave: Has the hon. Lady visited that country and others? I hope she has.

Mrs. Clwyd: Unfortunately, the Opposition do not have the Government's budget to make such visits possible. We believe in protecting the British taxpayer as far as we can—[Interruption.] I have a suspicion that 20th century grand tours by Ministers are not what eastern Europe needs just now.
It is important to consider the background of the countries to who aid will be given, starting with East Germany. Yesterday there was German economic and monetary union which was historic not only for Germany but for Europe and the world. It will ensure that aid is fast on its way to East Germany. East Germany reckons that it needs 130 billion deutschmarks for investment between now and 1993. It believes that British firms, with the help and encouragement of the Government, could invest in environmental development work, including water and sewage management, in financial services, hotels and transport, for example, in the railways. East and West Germany are anxious that aid and investment in East Germany should come from countries other than the Federal Republic, but it is inevitable that West Germany should carry the main burden.
There is also a firm belief in West and East Germany that the British Government have been slow to help and British companies slow to appreciate existing opportunities. One can but hope that the Prime Minister—

Mr. Tredinnick: rose—

Mrs. Clwyd: I am sorry, but I shall not give way again.
One can but hope that the Prime Minister, who met the East German Prime Minister last week, will do more to convince British firms that a developing country, which has a hard currency like the deutschmark, presents a unique opportunity for profitable investment. The British Government's know-how scheme for East Germany is, to say the least, bizarre. Although it is not yet under way, it is due to finish when reunification takes place later this year, so it will have a life span of a pathetic few short months.
Some British commentators fear that German economic and monetary union could go sadly wrong, with inflation taking off in Germany. We believe that such fears will prove groundless largely because the markets have already discounted the possibility by raising real interest rates to 6.5 per cent. German economic and monetary union may be going too fast, and its consequences may not be properly understood by the people of East Germany. Undoubtedly, there will be some dreadful results, with up to 25 or 30 per cent. of the population becoming unemployed. But the speed at which aid and foreign investment takes place could be critical in mitigating the damage.
This provokes another problem for East Germans, who must ensure that western capitalists do not rape their country and buy it out for the sale of the century. A warning given by the Organisaton for Economic Co-operation and Development in its publication "Economic Outlook" that eastern Europe risks being asset-stripped by western investors is one that we should all take seriously. East Germany needs productive investment that creates real jobs.
If East Germany is a special case, so too is the Soviet Union, which has special political difficulties and is moving much more slowly towards a social market economy. While the Soviet economy may, at present, be in no state to use the vast sum in aid that it will ultimately need, the immediate provision of credit can obviously help President Gorbachev buy more time for perestroika.
When the Prime Minister returned from a visit to the Soviet Union recently, instead of suggesting a package of aid and assistance, she came to the House and insulted it

with an hour-long, condescending and patronising lecture on what a backward country the Soviet Union is—a view shared by some Conservative Members. If reports are true that President Bush is working on guidelines for the United States and other NATO countries, at this week's summit in London, in support of direct economic aid to the Soviet Union, possibly the attitude of the Prime Minister and other Conservative Members will change.
Unlike some other countries in eastern Europe, the Soviet Union can see little prospect of a significant increase in bank lending from the west or raising funds by the use of securities. In addition, it cannot get bilateral aid from the World bank or the International Monetary Fund because it is not a member of either organisation and does not qualify for their assistance. The sooner that Britain and other countries seek to bring the Soviet Union into the orbit of the world's financial communities, the better.
Up to now, the Prime Minister has talked of aid only once structural reform has taken place, which is like ordering someone to build a house and offering to pay for the bricks only when the last roof tile is in place.

Mr.Beaumont-Dark: rose—

Mrs. Clwyd: No, I shall not give way because the hon. Gentleman has been muttering throughout my speech and I think that we are all aware of his views.
In this instance, the Prime Minister has failed to grasp the fact that the house can be built, indeed may only be built, if the bricks are provided in the first place. By comparison, the Dublin communiqué talks of short-term aid and aid for structural reform for the Soviet Union.
President Mitterrand went public on the Prime Minister's isolation after the Soviet aid package had been opposed by Britain in the discussions. He said:
Nobody voted for the British proposal.
He was particularly scathing about the Prime Minister's position. He described her objections as
Britain's penultimate twitch of life.
He added:
we can always count on her to ensure debates are long arid that the decisions taken are always retaken.
He said that she would be defeated when the aid package was considered at a Rome summit in October. Whatever the view of the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark), he will be carried along by the tide of events and his views, and those of some of his hon. Friends, will constitute a lone voice crying in the wilderness.
It is my understanding that the Soviet Union will get little help from the new European Bank for Reconstruction and Development, which is being set up in London because there will be special limits on lending to the Soviet Union. Will the Minister confirm or deny that? If it is true, it is a miserable state of affairs. It is no wonder that some bankers and Governments in Europe fear that the rouble will soon cease to be convertible, even in the rouble area. The world will let that happen and see President Gorbachev fail at its peril.
Of the other European countries, Poland, Hungary and Czechoslovakia are in the process of creating democracies, based on mixed economies and market principles. For both Poland and Hungary, the burden of servicing debt payments presents awesome problems. Poland's debt today, standing at $40 billion, is the largest in eastern Europe. My view, shared by some leading bankers in Europe, is that it will be all but impossible for Poland to


succeed in its endeavours unless both Governments and commercial banks are prepared to write off some of Poland's debt. Will the Government set out and justify their own views on that today?
Hungary's debt of $20 billion represents the highest per capita debt in Europe. Hungary's position was not helped earlier this year when a clumsy Bank of England report on the debt matrix created a loss of confidence in Hungary's creditworthiness. Partly because of that, Hungary has since had to get help from the Bank for International Settlements to add to its stand-by agreements from the IMF. Will the Minister ask the Governor of the Bank of England, one of the Prime Minister's family friends, to be more careful in future about damaging the prospects for development in other countries?
The present Hungarian Government say they can repay their debts and are not interested in debt rescheduling or debt forgiveness. I hope that their assessment is correct. Hungary has been engaged in economic experiments for 20 years, and this one certainly deserves to succeed.

Mr. Waldegrave: The hon. Lady is a spokesperson on aid in general and is asking us to forgive the debts of Poland and Hungary—middle income countries. Therefore, she is also presumably asking us to forgive the debt of all the far lower income countries which she often mentions. Am I right? I want to ascertain the extent of the huge expenditure of which she is talking.

Mrs. Clwyd: The Minister will have heard the Opposition advance that argument many times, particularly as there seems to be no will on the Government's part to make debt forgiveness a possibility for many developing countries.

Mr. Giles Radice: Have not the American Government recently announced that they are considering favourably the idea of debt forgiveness for Poland? The United States is Poland's biggest single creditor.

Mrs. Clwyd: My hon. Friend is perfectly right, and his point is consistently made by Opposition Members.
Naturally, the Opposition are also pleased about Britain's participation in the Poland and Hungary assistance for economic restructuring programme, which the European Commission is co-ordinating to help Poland and Hungary. We also welcome the food aid given to Poland, and lending through the European investment bank. We also approve of the setting up of the £50 million know-how fund for Poland and the £25 million know-how fund for Hungary, although we have reservations about its operation so far. The evidence, from both the recipient countries and the Foreign Office, seems to be that the know-how fund, particularly for Poland, lacks direction, has been unclear, and has confused the recipient countries.
An article in The Economist this month evaluates the fund by stating:
The most stinging complaint is simple: for expertise read fripperies. The Poles need drains: the know-how Fund has given them seminars … Such criticisms find an echo in Poland, where some claim that money is being wasted, extolling the virtues of the House of Lords, or the subtleties of a free press; they point out that they have a long (albeit submerged) parliamentary tradition, and, thanks to Solidarity, no dearth of first rate journalists.

We must not forget that eastern European countries have political traditions and the roots of democracy. Some of the criticisms and comments of the right hon. Member for Guildford smacked of a patronising attitude towards the established background of those countries. Eastern European countries need assistance to get those roots to flourish throughout society, and to get everyone, not merely business men, on their feet.
If eastern European societies are to become truly participatory they will eventually need their own versions of Greenpeace, Oxfam, the British Medical Association, citizens advice bureaux, farmers' associations and even the CBI, along with the many other varied organisations that represent citizens' views and interests.
The Government should not focus merely on business men and politicians—teaching them English and setting up exchanges—but should help to lay the foundations for a broader link between east and west.
The varied contributions made by the British Council, Voluntary Service Overseas and the World Service of the BBC all greatly enhance Britain's contribution to eastern European developments, but the Government are not providing those organisations with adequate funds to take advantage of new opportunities, except by cutting their work elsewhere. The key to providing the most effective aid is listening to voices on the ground in eastern Europe. At present, there is concern that there has been too much political control from London and that the advisory committee has been ineffective. We hope to see improvements in the programme for Hungary, which has scarcely started, but which should soon be up to speed.
The Foreign Office has had some teething problems in getting to grips with its increased work load in eastern Europe. That has led to cutting diplomatic posts in the third world, especially in Latin America and in Africa—a point made in the report by the Select Committee. The Foreign Office has diverted some staff from the Overseas Development Administration to work full time and part time on eastern Europe. Clearly, additional staff are needed at the Foreign Office and the ODA, but not at the expense of the third world.
I do not want to end my speech on a sour note, but I wonder how the Minister of State responds to the scathing criticisms of the know-how fund in The Times on 1 May:
Unfortunately, the Know-How fund does not seem to be connected with a coherent vision of a future Europe … So far, £2 million has been spent and there is nothing much to show for it … Britain is dwarfed by West Germany, overshadowed by France, Austria, and even Italy, in trade with Eastern Europe.
Changes in eastern Europe perfectly illustrate the need for countries to work together without one dominating another, and for the European Community—I was privileged to be one of the first elected Members of the European Parliament—to develop and extend its borders, as well as the need to recognise that no nation state can go it alone in today's world.
On our television screens we have seen the tearing down of the wall which divided Europe, the opening of Hungary's borders, and the emergence of Vaclav Havel from the long winter which followed the Prague spring. Britain should now be ready to play a role in such new and immensely challenging developments. When we win the next general election, our imaginative and constructive approach will show how limited and blurred the horizons of the present Government are. The Opposition will see aid to eastern Europe as part of the peace dividend which


follows the disappearance of the cold war, the iron curtain and the Berlin wall, and as part of all our hopes for the future of the world.

Sir Michael Marshall: I am glad to follow the hon. Member for Cynon Valley (Mrs. Clwyd) if only to say that I agree with her about some of the problems of the environment. Hon. Members who have had the chance to see pollution in the Elbe and Danube must recognise the huge task there, which could be a major opportunity for many of our industrial concerns which have special expertise and which could help to resolve such problems.
I regret that the hon. Lady felt that it was necessary to pitch into party political arguments. There is a genuine job of work for hon. Members on both sides of the House to do.

Mr. Budgen: Will my hon. Friend reconsider his remarks? It is obvious from the hon. Lady's speech that there is a vast division between the two sides of the House on this issue. If she wishes to emphasise that difference, she does a service to political debate. It is obvious that the Labour party plans substantial expenditure in eastern Europe. Since that inevitably means that it intends to print money or to increase taxation, it is right that the hon. Lady should have raised the temperature and told us where she disagrees with the Conservative party.

Sir Michael Marshall: I accept what my hon. Friend says about expenditure because, although the hon. Lady said that she would tell us more about it, she did not say precisely what she had in mind.
I wish to try to find a common cause, at least in the scope of the problem and the opportunities that arise for parliamentarians seeking to address this issue. I am sorry that the hon. Lady attacked the Government about the number of Ministers going to Hungary. She should be aware that, through the Inter-Parliamentary Union, 30 hon. Members have visited four eastern European countries in the past six months, and I greatly welcome that. I want to discuss ways in which we can build on this process. If the hon. Lady reflects on that and on the other initiatives taking place, she will realise that, if anything, the Government lag behind in the number of parliamentary links we have with eastern European countries.
I make no apology for referring to the IPU, but it does not have a monopoly. There are party-to-party links with eastern Europe and a range of other activities, including the party funding organisation that is being co-ordinated by my right hon. Friend the Minister with other parties in the House—I hope that he will say more about that in a moment.
In the past six months the IPU has had seminars and fact-finding missions, which would not have been possible in the short time scale leading up to the elections—and which have now effectively concluded with the Bulgarian elections—without the co-operation of organisations such as the Great Britain-Eastern Europe Centre. I am glad to see my hon. Friend the Member for Carshalton and Wallington (Mr. Forman) present, because he chairs the centre, with assistance from Opposition Members.
I also recognise the work of the Foreign Office, the Central Office of Information, the Clerks to the Overseas Offices of both Houses and organisations such as the Hansard Society, which have all been working in a

common endeavour to understand the needs of emerging democracies and to understand how funding—which we must consider when debating the estimates—is related to such work. Also I am glad to be able to pay tribute to Mr. Speaker—in his absence. As you will know better than most, Madam Deputy Speaker, he is especially concerned with Speaker-to-Speaker initiatives in eastern Europe, and, as an honorary president of the IPU, in support for all our parliamentary links.
The factual background is the reason why I picked up the hon. Lady's remarks about the amount of personal contact with eastern Europe. In the past six months, through seminars and exchange visits, 196 Members of both Houses—the vast majority from this House—have been involved in face-to-face and one-to-one discussions with parliamentary candidates or parliamentarians from eastern Europe—a pretty high striking rate. A third of our membership is involved in that process.
In the six months that followed the Berlin wall coming down, there were flying squad visits by two parliamentarians who went to the Federal Republic and the GDR—which are now emerging as a united Germany. It is important that we try to understand both sides of the German viewpoint. We were able to follow their visits through when parliamentarians from the GDR visited us here last month. It became obvious that they were extremely concerned to keep their bilateral links with parliamentarians such as ours, because as they become part of a united Germany they are conscious that outside links may be harder to maintain. We need to deal with the issue of how we can maintain contact with individual Lander in Germany when that process gathers momentum.
Similarly, the visits and the contacts that we have had with Romania, Czechoslovakia and Bulgaria have been followed up with the sending of observer teams for the elections. That, too, has been an important part of the learning process for us all.
The hon. Member for Cynon Valley mentioned The Times report on 1 May. It made a valid criticism of the extent to which we have demonstrated a lack of knowledge of some of the countries with which we are concerned in the two-way process.
I agree with my right hon. Friend the Member for Guildford (Mr. Howell) that a special concern to bear in mind in all this work is the role of the Soviet Union. That is why I was glad that the Select Committee, whose work is so usefully illustrated in the reports, has been part of the parallel processes. When IPU delegations from the Soviet Union and other countries are in this country, meetings with the Select Committee have, almost invariably, been part of the programme of the work of each seminar.
As it is only a short debate, I shall briefly touch on some of the issues that arise out of those exchanges. The need for seminars has been reinforced. Arguments have been advanced about the need for the English language, about the value of the BBC World Service and about our mature media and parliamentary democracy. Those are not items that people would wish to export—and nobody has claimed that—but it is remarkable how people can relate to that. Above all, the interest in the English language is something on which many can feed quickly. The enthusiasm and commitment of so many who have visited this House have illustrated that fact.
The Times article on 1 May, "Where are the British?", made a valid point in expressing concern about the lack of


British industrial involvement in central and eastern Europe. Anyone visiting those countries will quickly find substantial evidence of American, Japanese, Korean, West German and other European investment projects. That is an aspect that we need to keep in mind. On the other hand, we have shown that political initiatives by both the Government and the House have been first in the field, so The Times is quite misleading in suggesting that parliamentary democracy is not exportable. I reject that. It is in the very process of comparing notes and trying to assess our approach to the problems that our work has had value on both sides.
It is perhaps ironic that, at a time when there is a certain amount of excitement about local government finance, our visitors have applauded the superb opportunity—as they view it—to do things on the ground and to have decentralisation. How they go about that is a matter for consideration. No doubt there will be mixed views on the efficacy of the community charge as opposed to other forms of local government finance. The thrust of the exchanges has highlighted an insatiable thirst for political exchange and political dialogue and a need to have a form of parliamentary recognition. That is sometimes underestimated as people come forward in these challenging and difficult areas.
I want to discuss one or two areas that we should think about in arranging our long-term exchanges with those countries. I have mentioned the media and the press, which are of special interest. It is also interesting that the concept of a non-political civil service arouses a great deal of interest among our visitors. It is quite difficult to know how to demonstrate that. However, it is clear that, for many visitors, the opportunity to sit in and observe the work of the Clerks to the Overseas Offices of both our Houses, or to sit with a local government officer, has been a major part of the learning process. That has been highlighted by the one-to-one constituency visits between our parliamentarians and those from other parts of the world. We can reflect only that, perhaps, we have never fully appreciated the way in which our system sometimes gives us advantages in having a particular strength and a particular intimacy. Although others may not use the same system, it is clear that our process of relating to a voter is something that immediately gets their minds working in a way that will assist and, perhaps, be part of their immediate political development.
I shall now discuss the role of the House and of the Government in taking matters ahead. There is a problem with co-ordination. My right hon. Friend the Minister of State has shown great interest in that when talking to hon. Members from all parties. That also reflects the views of my right hon. Friend the Foreign Secretary. If we move, as we hope, to bi-monthly seminars in 1991 and away from the old concept of the semi-state parliamentary visit to working visits that allow people to get down to the nitty gritty, we need to have some understanding of what is taking place in parallel with that. Within the Inter-Parliamentary Union, a committee of the Twelve-plus—that is, Sweden, Italy and ourselves—is seeking to pool all the information and the intelligence about what is happening throughout western countries in assisting in the process. Similarly, there is work in the Council of Europe

and the European Parliament. There are party-to-party links and individual activities by members in all these areas.
I hope that my right hon. Friend the Minister will feel that the Foreign Office could serve not only his thinking but that of the House by holding a conference or seminar—it may be once every six months—at which the various interested parties might meet to take stock and to share common experiences. In making our plans, all of us have experienced a little uncertainty about how far we might be tripping over each other in some of the processes. Although there has been a rush to try to achieve a certain amount of common ground before the elections, there is still major activity that needs some co-ordination and planning. In that sense, I reflect and agree with some of the comments about the need for a comprehensive strategy in considering the way ahead. I hope that we can find work that we can share. I urge the House, in considering the estimates this afternoon, to applaud the work of the Select Committee and the work that the Government are seeking to lead.

Dr. David Owen: It is, perhaps, appropriate that on the day that the two Germanies are sharing a common currency and open frontiers we should be discussing this most central question—the political and economic development of central Europe. The dynamism behind the integration of the two Germanies has been truly staggering.
If we think back to previous debates in the House, few of us would have anticipated the pace of events. Many tributes must be paid, but, above all, the one figure who has shown remarkable foresight and courage has been Chancellor Kohl. His political anticipation of events was important. He overrode the reservations of the Bundesbank about a common currency and, especially, one-to-one personal currency exchange.
I wish to draw attention to one considerable concern that we are not showing anywhere near enough political foresight about—the need for a successful economic transformation to a market economy and a buttressing of the democracies of Poland, Hungary and Czechslovakia. I am fully confident, as I think that most hon. Members will be, that a united Germany will, very rapidly—perhaps in under two years—transform the economy of East Germany, and become a fully democratic member of the European Community and of NATO.
However, if we look even now at the development of Poland, Hungary and Czechoslovakia, none of us can be certain that those three countries, which have made a democratic commitment and a commitment to the market economy, will succeed. It is of fundamental importance to the stability of Europe that those three countries succeed, within a short time, in making that transformation.
There are many candidates for the peace dividend. There is no question but that there will be substantial reductions in defence spending. Those within the Soviet Union will be an important part of its attempt to make perestroika succeed. It is in our interests to hasten the process of conventional force reductions and to increase nuclear reductions. All the NATO countries can also look forward to reasonable reductions in what has been a heavy defence cost ever since the end of the world war. We have contributed greatly to that process.
It is understandable that people will look to an improvement in many aspects of their domestic lives as a result of the peace dividend—whether it is through spending on the health service, the relief of poll tax, or further spending on higher education or training for technical skills. Goodness knows, we need more spending on those sectors. If we are truly buttressing peace, we should be well advised to ensure true democracy in Czechoslovakia, Hungary and Poland.
In the middle 1970s, there was an extraordinary political thrust to buttress the new-found democracies of Spain, Portugal and Greece as they emerged from fascism. That political thrust is now necessary to ensure the success of Poland, Hungary and Czechoslovakia. The European Community has been remiss in not giving those countries the certainty of membership of the European Community. I know that many in Brussels find it suspicious when we talk about enlargement of the European Community because they believe that Britain suggests it as a way to weaken the growth of unity within the Community and its further integration. I can claim a long-standing record of commitment to British membership of the European Community. I believe that, in the immediate aftermath of the crashing down of the Berlin wall and all the epoch-making changes, it was right and natural to look to the strengthening of the Twelve and to ensuring that the Federal Republic of Germany in its unified state was an integral part of the Community.
It is also natural and right to ensure that the Atlantic link remains and that NATO finds increased unity to cope with these challenges. However, it would be a tragedy if the European Community did not also see an extremely important part of its future contribution in Europe as enlargement, at a reasonable pace, to include Poland, Hungary and Czechoslovakia, and also Austria. That prospect, around the year 2000, may be opening up. For all the advantages and the welcome attempts of initiatives such as the know-how funds and the European Bank for Reconstruction and Development, none will be of such lasting value and permanence as the certainty of European Community membership.
I know that people will raise the spectre of the Community expanding to include Sweden, Finland, Switzerland, Turkey and the rest. We have to be blunt. Some of those countries do not have the same democratic imperatives. Sweden is fully democratic and we can grapple with the problem of Sweden as we deal with the need for European economic space in the EFTA-EC negotiations. Switzerland can look after itself. Turkey is, quite frankly, not a European country and it is time that we said so and were open about it. It is an associate member, but it must not look to full membership of the Community.
Poland, Czechoslovakia and Hungary need the buttressing of European Community membership. Those who believe in an eventual common currency, the prospect of monetary union, the need for greater decision making as a result of majority voting in the European Community, strengthening of the European Parliament's powers and an increased role of the Council of Ministers should also argue the case for enlargement. It should come not just from this country but from France, the Benelux countries and Germany.
Germany has made it clear that it will take the financial burden of the integration of the two Germanies. It will pay the full price of economic and democratic development in

East Germany, with its environmental pollution problems, and will pay a heavy price to the Soviet Union to ensure that the Soviet forces coming out of East Germany are rehoused in reasonable barracks and, in the short term, that there is continued payment from Germany to those troops in their country. I hope that that withdrawal programme will be conducted with the utmost urgency and I am pleased that the Federal Republic has shown its sensitivity in realising that Russian generals have to be able to say to their forces coming out of eastern Europe that they will go into proper barracks and remain in reasonable conditions.
The country that ought to be asked to pay a heavy price for the development of Hungary, Poland and Czechoslovakia is Austria. That is why it is important to tell Austria that it will come into the European Community after 1993 but that, in that transition, it will be expected to help in the market orientation of those countries, particularly Hungary.
It is reasonable for countries such as France and Britain to jump over East Germany and concentrate their investment and political initiatives on Poland, Hungary and Czechoslovakia. East Germany has help from its fellow countrymen. We should be prepared to see that as, effectively, a responsibility for West Germany and we should go out to the other countries as fast and as quickly as we can. We ought not to be too afraid of the economic doubters. I remember how many people said to us in 1977 that Spain would not adapt and would be a constant drag on the European Community. Given reasonable help, those three countries will succeed as Spain has.
The right hon. Member for Guildford (Mr. Howell), who contributed positively to the debate, pointed out that, when looking at debt, we should differentiate between that which has been incurred by communist Governments and that incurred since transition. It is unreasonable not to treat the mountain of debt that they inherited from the past on a different basis. Debt write-off, project aid and technological assistance have to be geared tightly towards movement to a market economy.
I agree with much that the hon. Member for Cynon Valley (Mrs. Clwyd) said. However, there is a danger in her approach, which almost equated the Soviet Union arid those other countries. It is that the Soviet Union is so vast and that it has not yet made a full commitment to democracy or the market economy. It is not an echo from the cold war to say that the Soviet Union must be further back in the queue for market and democratic assistance. We cannot give to it and those other countries at the same time.
I would make an exception of the extremely enlightened suggestion of the Dutch Prime Minister Lubbers at the Dublin summit for an Energy Community, which has not received much publicity. The Soviet Union is rich in hydrocarbons—oil, coal, and particularly gas. If Europe really wants to make a rapid movement against environmental degradation and carbon dioxide emissions, nothing would be better than to move into natural gas. A certain supply of natural gas from the Soviet Union throughout Europe would be an immensely stabilising and attractive investment. It would also be a way of ensuring hard currency for the Soviet Union.

Mr. Brian Sedgemore: Will the right hon. Gentleman clarify one point? At the recent summit, politicians instructed the


European Commission to go away and find out how the European Bank for Reconstruction and Development could provide investment funds to the Soviet Union and how the IMF and GATT could help out. Is the right hon. Gentleman for or against that proposal?

Dr. Owen: I am not against it, but I draw some comfort from the fact that lending from the European Bank for Reconstruction and Development will be spread among the countries of central and eastern Europe committed to and applying principles of multi-party democracy, pluralism and market economics. It is the first time that we have ever so overtly tied aid and bank reconstruction programmes to pluralism, democracy and market economy. I should not want to dilute that at the moment with the Soviet Union. We should hold open the prospect of aid to the Soviet Union, but, to be quite blunt, I do not believe that Mr. Gorbachev has yet accepted anything more than a managed democracy and a managed economy. I see no sign that Mr.Gorbachev has accepted the disciplines of a full democracy or market economy. We would be putting bad money after worse if we poured it into the Soviet Union at the moment. We learnt that lesson with the money that we put into Poland too soon in the early 1980s and we would not do well to repeat the same mistakes.
The proposed energy project is a serious commitment of mutual benefit. There is also a danger that the Soviet Union may move too rapidly into charging its former satellite countries full economic prices for their energy. There are many signs that the Soviet Union wishes to do that and to demand hard currency. If that happens too quickly, those countries will have an added burden for which we shall have to compensate. I hope that the Government will carefully consider the Lubbers proposal and ensure that at the next European Council it is given every bit as much consideration as the proposals by France and Germany for extensive Soviet aid. Such a proposal would give more value to the wider Europe from the Atlantic to the Urals. It has strategic and political significance and would provide the economic underpinning that Europe needs.
Finally, it is not easy to overestimate the value of the investment of the British Council and the BBC World Service. I hope that the remarks of the Select Committee in that regard will be taken seriously into account. I understand that the British Council will have to find the money from its own resources in the next few months and that the know-how fund is being made available for only a short time. It is no good looking at the BBC only in terms of radio. The new medium of communication is television. It is absurd that Cable and Network News and American culture is blasting into every country in the world with considerable facility and skill. The BBC ought to be involved in television news worldwide. It should also carry advertising. The sooner the BBC establishes a worldwide challenge to CNN, particularly in Europe, the better. It is no good thinking that we will get the same value that we have enjoyed over many decades from the BBC World Service simply by relying on radio. We have to move into television very fast indeed. Given the atmosphere of our relationship with eastern Europe, it would be a very good place to start.

Mr. Anthony Beaumont-Dark: Such debates are always fascinating. Yesterday there was one kind of Germany and today, it is said, there is another. This time last year we would never have dreamed of the changes that have taken place. It is natural for politicians, particularly leading politicians, to talk about splendid visions, the ideals of what we should be doing and the money that we should be giving—usually other people's.
I agree with some of the comments of the hon. Member for Cynon Valley (Mrs. Clwyd) about third world aid. It is important that the money that we are dishing out in such huge bucketfuls should not be at the expense of the third world. However, I bring one point of realism to the hon. Lady. It is no good talking about percentages. Socialists are always keen to talk about percentages. Perhaps the Government do not give the right percentage. The socialists might well have given the right percentage, but they gave the wrong sums of money. We are giving greater sums of money and greater real help. It is no good talking about the starving. If our economy were a quarter as good as it was when the socialists were in government, the percentages would look better but money and not percentages fills stomachs.
The Opposition talk glibly about debt forgiveness, but who is to pay for it? We are talking not about a few tens of billions of pounds or dollars but about hundreds of billions. One thing is certain: an individual country can renege on a debt just once, but then it becomes a wasteland of the financial dead because no one in his right mind will ever lend it money again. It becomes a banana republic and people have to give it money because they know that they will never get it back.

Ms. Diane Abbott: Will the hon. Gentleman give way?

Mr. Beaumont-Dark: No, other people wish to take part. [HON. MEMBERS: "Give way!") I cannot refuse that challenge.

Ms. Abbott: I agree with the hon. Gentleman that debt reduction is a complex business, but does he accept that the sums of money that were sent to Poland and South America have already been spent? Everyone knows that the prospect of many of those countries ever repaying their debt is extremely doubtful. It is no help to continue pretending that the money can be clawed back. Debt reduction is complex and difficult, and we have to take it seriously.

Mr. Beaumont-Dark: I agree with the hon. Lady that each country and each debt is an individual problem. Hungary, however, is adopting the right attitude, having said that it does not want to rephase its debt because it believes that it can earn its way out of the crisis. It may well be that because Poland has so much moribund industry, as the right hon. Member for Plymouth, Devonport (Dr. Owen) said, we have learnt from what we did in the 1980s in Poland, throwing money into things that should have been obliterated.
The Opposition say that they wish to form a Government at some time in the next 20 years, but if they think that they can give away other people's money and expect the world to become a more stable and healthy place, they are living in cloud cuckoo land. The same


applies to Mr. Gorbachev. At the moment, Gorbachev mania is running around the world in the same way as Mandela mania. So far as I am concerned, what Chancellor Kohl is trying to do involves some of our money as well. Despite what the right hon. Member for Devonport said, it is not all West German money; £2.3 billion of EEC funds is going to the east and £8 billion of the £20 billion that the right hon. Gentleman spoke about so glibly will come from EEC funds. That is our money, too, and it is to be sent on propping up a man who, as they say in the midlands, "can speak good, can't he". He can certainly speak good, but what has he promised? It is clear that he wants not to change communism but to run it better. We in the western world, even the socialists, know that that socialism is dead. Socialist members of the Select Committee realised that when they returned from eastern Europe. Communism does not work for the good of people.
Chancellor Kohl wants to build new Germany and to throw $20 billion at another wasted enterprise. Russia must learn, as East Germany is learning, that to achieve real change will involve some real pain. Two million people in East Germany are about to experience two years of misery, possibly followed by 20 golden years.
We have all seen the pain of communism. It is not that the people are bad or unwilling to work, but the communist regimes that have borne down on them for generations cannot work. We must teach the Russian people that realism plays no part in their lives.
I should like to say something about Germany, but not in a carping sense. There have been three reichs, the last of which was a war reich. I do not believe that the fourth reich will make anything other than a peaceful transition to another Germany, because it is a new Germany. It is no good people always harping back to the war. Anyone who has met Germans knows that they are more tired of wars than us. Anyone who has visited Dresden, which has been rebuilt but where hundreds of thousands of innocent Germans died, knows that the Germans do not want wars.
I am not saying that the fourth reich will be a war-like Germany, but anyone who believes that the new Germany will not be a desperate battleground for this country and other countries is living in a fool's paradise. East and West Germany together will stand astride the world with Japan and America. There will be desperately difficult and challenging times ahead for our trade and industry. Anyone who thinks that East Germany's growth will provide us with huge oppportunities does not understand the German mentality. The Germans rightly want to build Germany into a huge, powerful unit. They say, "Let us not talk about Germans, British or French, let us talk about Europeans". But when the Bundesbank talks about Europeans, what does it mean? Who is to run the world banking system? Surprise, surprise, it is the Bundesbank.
Our manufacturing industry will have to change and receive more Government support than it has had in the past. The Foreign Office must change its attitude to the ambassadors it supports. Our ambassadors—happily, we saw at least one good one while we were away—must place more emphasis on trade expertise. If the Common Market means anything, it means that each country should not waste its money on having its own foreign affairs channel. We want more emphasis on trade and industry so that Britain can at least play its part in competing in Europe, with West Germany, East Germany and a united Germany. Challenges and opportunities mean dangers. If

Britain is to survive, it will do so not on changing the guard at Buckingham palace and on Sainsburys, but on manufacturing and trading our way out of the problems that we face.

Ms. Diane Abbott: Every hon. Member was thrilled to see the cruel and tyrannical regimes toppled throughout eastern Europe; nothing like it had been seen since 1848, the year of revolution.
All hon. Members support the political liberation of eastern Europe, but the House should consider what the immediate economic and social consequences will be. It should also consider the broader picture and the consequences for the rest of the world, particularly the third world, of events in eastern Europe.
I spent last week in eastern Europe with other members of the Treasury and Civil Service Select Committee. We visited Frankfurt, Berlin and Budapest and met politicians, business men and financiers, including Mr. Pöhl of the Bundesbank, who will sit astride the Europe of the future, like a direct descendant of the holy Roman emperors.
It is hard to escape the conclusion that in the immediate future the big gainer from current events will be West German capital. The short-term consequences for the living standards of ordinary people in eastern Europe look a little bleak and the consequences for the third world could be disastrous.
There is no doubt that West German banks and financial institutions are excited by events in eastern Europe, particularly German economic and monetary union. The word the bankers used time and again was how "emotional" they felt about events—an unusual word for bankers. Huge sums are poised to pour into eastern Europe, particularly East Germany, through Governments, private investment, the World bank, the IMF and institutions such as the European Bank for Reconstruction and Development.
In rebuilding East Germany, West Germany has the edge if not the monopoly. West German business and finance share a common language and culture with East Germany and have well-established links. The House should bear in mind that the interests of West German capital in East Germany are not necessarily focused on the manufacturing sector and job creation. The keenest interest seems to be in the service and retail sector. Deutsche Bank is poised to take over the East German Kreditbank; Lufthansa is poised to take over the East German Interflug; and Allianz, the West German insurance company, will take over the entire East German insurance industry.
When the ownership problems in East Germany are finally resolved, there will be a bonanza for property developers, because some land in East Germany is seriously undervalued. If, as seems almost certain, Berlin becomes the capital of a unified Germany, there is prime real estate in Berlin ripe for exploitation by Germanic Donald Trumps. Some of the East Germans we spoke to regard the precipitate economic monetary union of West and East Germany as, sadly, a once-and-for-all opportunity for West German business interests to buy


East German assets at knock-down prices. Some East Germans described German economic and monetary union as the sale of the century for West German banks.
There will not be, as Conservative Members have said, a huge manufacturing opportunity for British manufacturing industry. At present, Britain's role seems to be to provide an army of accountants or management consultants—a carpetbagger army of consultants.
The paradox is that if we take into account the western blockade which deprived the East Germans of access to technical information, the East German economy was relatively successful. But East Germany was saturated with West German television and became obsessed with access to hard currency and consumer goods. Hon. Members will have seen television pictures of people fighting to get their deutschmarks yesterday. Members of the Select Committee saw in Berlin the queues to open banks accounts, but some East Germans are having second thoughts because of the danger of asset stripping, and East German economists know that GEMU has moved too fast. It is driven by politics rather than economics and runs the danger of creating a money society.
Conservative Members said that there was a possibility of unemployment in East Germany because of GEMU. The politicans, bankers and financiers to whom we spoke said that there would certainly be mass unemployment—perhaps as many as 4 million people—and that as many as one third of the companies were expected to go bankrupt. There are already cuts in support for welfare services such as libraries and nurses, and in support for East German sport. Women with children are being sacked because they are not seen as productive. The market economy will work in East Germany because West Germany has the wealth—the long pockets—to make it work. Even in East Germany, the people will pay a grave economic and social price in the short term. It is difficult to see how the rest of eastern Europe can sustain stable, liberal democracies, given the bankruptcies, unemployment, falling real incomes and the doubling and trebling of prices which are certain to be the immediate result of the introduction of market economies.
By all means let us be euphoric about the introduction of political democracy into eastern Europe, but the social and economic road down which eastern European countries have still to go is difficult. For most of the ordinary peoples of eastern Europe, the immediate result of the introduction of capitalism will be a drop in their real living standards, extraordinary instability and uncertainty.

Mr. Andrew Rowe: I rise on a genuine point of information because I do not know the answer to my question. Can the hon. Lady enlighten me? Is the standard of, say, child care provision enjoyed in East Germany higher than that available in West Germany or is it lower? Will the East Germans be able, in time, to look forward to an improvement when the two sides of the country merge?

Ms. Abbott: It is not so much that the standard is higher—provision is much more heavily subsidised in East Germany than in West Germany. Interestingly, women in East Germany have free access to abortion but the rights of the foetus are protected in the West German constitution. Not all forms of social provision and all

social rights are necessarily better in West Germany than in East Germany. The quality of accommodation in East Germany may not be higher than in West Germany, but the subsidies are much higher. The women to whom I spoke were frightened as the creches were closing because Government subsidy was no longer available.
It was clear from my visit to eastern Europe that racism was surfacing again, particularly in Germany. The neo-Nazis are resurfacing and there have been attacks on black people and immigrant workers in the streets. There have been demonstrations outside migrant workers' hostels. Jewish cemeteries have been dug up and a memorial to Bertolt Brecht was defaced because it was said that he was Jewish. One frightening aspect of unification which has not been given particular emphasis in this country is the surfacing of the dark side of German nationalism, which involves anti-semitism and antagonism towards migrant workers. Thoughtful East Berliners pointed out that there are 70,000 Turks in West Berlin. They are not guest workers but a settled community. There will be unemployment in East Berlin as an immediate result of German economic and monetary union. What will the East Berliners say about 70,000 Turks holding jobs that they will regard as German jobs? In the short term at least, this must increase racial pressures.
The capital inflows into eastern Europe will be at the expense of the third world, whether they come from commercial or from governmental sources, no matter what Governments may say to the contrary. Mr. Barber Conable, president of the World bank, is on record as saying that private sector investment in eastern Europe will be at the expense of the third world. Despite all the euphoria about the new Europe and Fortress Europe, at a time when living standards are dropping all over the third world—perhaps because of poor government and certainly because of greater third world debt—it would be unfortunate if the House blithely looked to events in Europe and did not consider the consequences for the third world and Commonwealth countries.
Debt reduction has been discussed. Bankers in East Germany are already talking blithely about a 70 per cent. debt reduction for Poland. That is all very well, but if there is to be debt reduction for any middle income country, whether it be Poland, Mexico or Jamaica, the reduction should be equitable. West German bankers told us that there must be debt reduction for Poland because the Poles are very poor. There are people in Africa and central America who are even poorer than the Poles. It would be wrong for the long-term stability of the world if we looked at the issue of debt reduction for Poland in a narrow, Euro-centric way and did not take the issue in its totality.
Despite claims to the contrary, interest rates in Germany must rise once the December elections are out of the way. It seemed clear to me from sources close to the Bundesbank that, to attract the capital inflow necessary to rebuild East Germany and to check inflation, West German interest rates must rise. That will make it even harder for the third world to repay its debt—a debt that is crippling economies around the globe.
In Europe's euphoria about the political changes in Europe, the third world is in danger of dropping off the end of the world's agenda. In what will be traumatic economic times, the House and this country should think about the kind of economic support that we can give the countries of eastern Europe. The exact kind of economic


support is a difficult matter, but it needs to support progressive economic and political changes and not just prop up decaying regimes.
Let us be in no doubt—the market has no magic wand to wave. In the short term, the consequences of the introduction into eastern Europe of a free market will be a measure of political and social crisis that will vary from country to country. Like many hon. Members and people outside the House, I should be seriously aggrieved if the House were to jettison its long-standing connections with the third world and the Commonwealth in the light of current events in eastern Europe. We must help eastern Europe, but we must be mindful of our responsibilities as citizens of the world and of the interests of the poorest communities in the world.

Mr. Nigel Forman: In the interests of time, I shall not take up the points made by the hon. Member for Hackney, North and Stoke Newington (Ms. Abbott), much as I would have been tempted to do so in other circumstances.
I welcome this debate on assistance to eastern Europe. I congratulate my right hon. Friend the Member for Guildford (Mr. Howell) on his speech. I speak not only as a member of the Foreign Affairs Select Committee but also as chairman of the Great Britain-East Europe Centre. Hon. Members may not know that the centre was established in 1967 to promote a closer understanding between the British people and the peoples of Bulgaria, Czechoslovakia, Hungary and Romania by fostering cultural, economic, educational and social contacts with them. In 1988, the centre extended it activities to include Poland and the German Democratic Republic. It has organised round tables, symposiums and seminars for exchanges of view between people with similar professional interests, whether in the law, medicine, conservation, urbanisation, economics or the environment. It has invited a wide range of individuals from its six partner countries for two-week visits to the United Kingdom, with the people chosen by the centre and not designated by the previous communist Governments. The centre has sponsored young people coming to the United Kingdom for the first time to attend courses and summer schools.
Since 1989, that annus mirabilis for the peoples of eastern Europe, the centre has stepped up the pace of its activities by organising, in co-operation with the Inter-Parliamentary Union, and with the welcome support of Mr. Speaker, a series of seminars on practical aspects of democratic politics and political organisation. More than 80 people from five countries were brought here for the seminars—many of them involved for the first time in a genuinely pluralistic political process. It was a cause of real satisfaction to me and to many of my hon. Friends that some of them became Members of Parliament or even Ministers on their return to their home countries. It was good to know that, with the indispensable financial support of the Foreign and Commonwealth Office, it was possible to make a real contribution to the building of new democracies in eastern Europe. I entirely agree with the right hon. Member for Plymouth, Devonport (Dr. Owen), who drew a parallel with the countries of the Iberian peninsula and referred to the role that the bolstering of economic contacts—and, ultimately, after some years,

membership of the Community—could make to the progress and reinforcement of democracy in eastern and central Europe.
Perhaps the mechanism of which we in Britain can be the most proud is the know-how fund, set up since the momentous events of last year. The fund, which was unjustifiably criticised by the hon. Member for Cynon Valley (Mrs. Clwyd), has been a pioneering model of its kind and is now being replicated by some of our European partners. I hope that its coverage will soon be extended to Bulgaria and Romania—a point touched on indirectly by the Prime Minister in her statement on 1 May following the special European Council in Dublin, when she said that the group of 24 intended to extend their assistance to Bulgaria and Romania. In that context, it would be logical for the know-how fund to cover those two countries as well.
Once again, I should declare an interest as I am a member of the advisory board of the know-how fund and have been able to build up some experience in that way. My experience and involvement have taught me several things. First, a shortage of funds has not been a problem for the countries that we seek to help, as we understand that more money will be made available as new, worthwhile projects are identified.
Secondly, the aid and assistance that Britain has been able to channel to those countries is additional to the resources already allocated to our overseas aid budget. That is absolutely clear, and it is worth putting it on record; indeed, my right hon. Friend the Minister may wish to endorse that point in his winding-up speech.
Thirdly, the fund is engaged in nothing less than helping to provide the people concerned with the skills needed to run a market economy and a democratic pluralist society. For example, the fund has been able to help the Poles by providing them with basic skills in banking, accountancy auditing and commercial law—all of them vital in effecting the transition to a market economy. Equally, we shall be helping the Czechoslovaks with their embryonic policy of privatization—on which, as I know from a recent visit, they are very keen—and with the establishment of small businesses, which will be absolutely vital to their chances of avoiding mass unemployment.
I recently returned from a visit with a delegation to Czechoslovakia, where I was able to see at first hand the scale of the tasks to be tackled. Sober people estimate that the whole economy of Czechoslovakia is probably 15 to 20 per cent. over-employed. Were the Czechoslovaks able one day to achieve western levels of productivity, the existing level of industrial output could probably be achieved with half the present work force. That is the scale of the problems that confront Czechoslovakia. In other words, Czechoslovakia and all its partners in the now moribund Comecon need to engage in the most extensive economic restructuring. There is much that we in Britain—especially in the private sector—can do to help to bring that about.
So far—with the notable exception of the German Democratic Republic, which is really a special case—British business men seem to have been a little slow to explore the potential for joint ventures, foreign equity participation and all the other mechanisms of economic co-operation. It would be good for this country and for countries such as Czechoslovakia if more firms followed


the rather rare example of Barkotex, which has already formed a joint venture in textiles, and Bovis, which has launched two joint ventures in construction.
Certainly British industry and commerce have a lot of ground to make up before they can begin to match the efforts of big firms in other countries such as Bata in Canada, Volkswagen in Germany and Fiat in Italy, all of which are much further advanced than our firms in forging the necessary economic partnerships.
In general, I think that it is fair to say that so far the record of our public sector in providing practical training and assistance to the countries of eastern Europe has been superior to the performance of our private sector in direct investment and joint ventures. For the good of Britain and for the good of the recipient countries, we must hope that such an imbalance will be rectified as soon as possible. Both public and private sectors have a useful part to play in helping to transform the eastern European economies and to strengthen what Ralf Dahrendorf has rightly called civil society in those countries.
I commend Ministers for the timely and effective lead that they have given, especially via the know-how fund, and I urge them to use all their influence within the Community and within the OECD framework of 24 to bring about further practical progress.
In my view—and I agree once again with the right hon. Member for Devonport—it is a vital British and Western interest that the economic and political revolutions in central and eastern Europe should not fail. The fact that they were successful in the first flush of enthusiasm does not necessarily mean that the countries will find it so easy later on. We should do all that we can to assist them in practical and cost-effective ways, preferably concentrating our help on those things that we do best in this country. It is all to easy to make snide remarks about help with the police, local government and the civil service. The fact remains that those are our relative strengths and it is right that we should give them priority in our efforts to help the countries of eastern Europe.
At the same time, however, we should use our influence with the new democratic Governments of those countries to encourage them on the difficult but necessary path to price reform, currency convertibility and much more extensive private ownership, without which their bold and magnificent experiments may not succeed.

Sir Russell Johnston: Like the hon. Member for Carshalton and Wallington (Mr. Forman), I shall be brief because time is pressing and many hon. Members wish to speak.
I am still euphoric about the events in eastern Europe, and that will, I suppose, affect what I think and say. The glorious achievement of a long-deferred hope remains very exciting, but it lays on us a great responsibility. That responsibility may be difficult to fulfil, but we have a duty to take it on and not to be mean or exploitative about it.
Let me deal first with the Soviet Union—the big one. I do not agree with the position adopted by the Prime Minister in Dublin and stated today by the right hon. Members for Guildford (Mr. Howell) and for Plymouth, Devonport (Dr. Owen). We must look seriously at ways of

giving Gorbachev economic support and help. I said that first in the Western European Union Assembly in December last year, so it is not a new view.

Mr. Beaumont-Dark: Why?

Sir Russell Johnston: Because—I shall quote myself, which is always useful—as I said then:
The price of helping Russia to change must be balanced against the cost of defending ourselves against her … It is a time when I believe that boldness, not timidity
should guide us. It is all very well the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) uttering remarks from a sedentary position, but it is extraordinary to suggest that Chancellor Kohl is anxious to pour money down a black hole. I do not believe that that is the German approach to such matters. Of course there must be prudence and order and care must be taken and I do not believe that the proposals coming from the Germans involve anything other than that—nor am I afraid of the link that the Germans are making with NATO and troops. We must face up to our responsibility to assist the changes in the Soviet Union.

Mr. Beaumont-Dark: Does not the hon. Gentleman understand that GNP in Russia is dropping by 5 per cent. a year? How can giving the Russians £20 billion bolster anything unless there is real change?

Sir Russell Johnston: I am not saying that we should give them £20 billion. I am saying that we should look at constructive ways of assisting their economy.
I was not clear about what the right hon. Member for Devonport said about some sort of accelerated membership of the European Community for Hungary, Poland and Czechoslovakia; I do not know how that would work. I take the view that the existing Community must sort itself out and give those countries assistance. We must offer them associate status as and when and look to the point at which they can join, but that cannot all be done at once.
Like the hon. Members for Hamilton (Mr. Robertson) and for Carshalton and Wallington, I am also a member of the know-how fund advisory board, which has been confined so far to Poland and Hungary, but will probably cover Czechoslovakia. I hope that the Minister of State will refer to East Germany when he replies because we would like to know what the position is with regard to East Germany.
The British Council and our embassies are a little overwhelmed at the moment. They need more people. There is a genuine area of cross-party co-operation in that regard and perhaps hon. Members can help in an organised way. The hon. Member for Cynon Valley (Mrs. Clwyd) referred to overlap, and I am still worried about that. It has been suggested that the Council of Europe has a role to play, and clearly the European Community also has a part to play. However, we must consider what is happening. In general, I believe that the progress has been constructive.
My hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) has just returned from a Treasury and Civil Service Select Committee visit to the east. He has stressed that the Hungarians do not want their debt cancelled because they believe that that is unnecessary. That is contrary to the point made by the hon. Member for Cynon Valley.
The context of German reunion must involve faster and more confident European integration. Bulgaria has held its election and has produced the successor Communist party and the Bulgarian socialist party is now in office. That party won what most observers considered to be a reasonably conducted election. One of my party members, Miss Sarah Ludford, witnessed the elections and said:
Forty-five years of Communist totalitarian Government obviously leave a legacy which cannot be removed in a few months … this undoubtedly produced a climate in which a lot of people felt pressurised to vote"—
for the successor Communist party—
we were told of none-too-veiled threats about loss of jobs and pensions … although the vote itself was secret … that secrecy may not have given people enough confidence to vote for the opposition.
That is also true of Romania. I was in Romania during the election and I saw almost the same thing. There were then also the awful events when the miners rampaged through Bucharest and the west said, "Hold off. It looks like Iliescu is simply a repetition of Ceausescu." I do not believe that that is true.
In Innsbruck the day before yesterday I was fortunate enough to spend half an hour with the new deputy Prime Minister of Romania, Dr. Severin. I wrote to the Minister of State about that meeting, but he will not have received the letter yet. The Romanians are trying hard to give the opposition a place. The leader of the Romanian Liberal party, Mr. Campeano, is now the deputy president of the Senate, and the Peasants party is also getting opportunities. In the west we must decide whether the Romanians are behaving openly and, if they are, we must help them.
The hon. Member for Carshalton and Wallington referred to the collapse of a civil society. Nowhere did that happen to a greater degree than in Ceausescu's Romania. The civilised society had almost disappeared there. However, it is surprising how quickly it can be brought back.
It is important to be prudent. However, we must also be positive and generous. We must not exploit or asset strip. Instead we should try our best to show the acceptable face of democracy and capitalism.

Mr. David Tredinnick: Recently I had the honour to host the first ever conference for Members of Parliament from both east and west Europe, that is, democratically elected Members of Parliament from east Europe and candidates from countries such as Czechoslovakia which had not yet held their elections. The conference was held at Lancaster house and involved nearly 30 Members of Parliament and 80 delegates. I want to thank my right hon. Friend the Minister of State for his support and for making know-how fund money available to the British Atlantic group of young politicians, of which I am chairman and which organised the conference. His help was invaluable.
In my brief speech tonight, I want to share with the House some of the impressions that I gained from the delegates from all the east European countries, including the Soviet Union. I want also to refer to the special position of the Soviet Union and consider what we can do to help. Then I will consider the changes in the European Community which the reforms in eastern Europe are bringing about and the way that those changes are being addressed.

The British Atlantic group of young politicians is a NATO-supporting organisation. Last year it decided that, because there were glimmers of hope and democratic developments in east Europe, the group should try to develop contacts with those countries. As chairman of that group, I can say with some pride that we perhaps anticipated events and our conference at Lancaster house was set up well before November last year.
The first impression that I gained from the conference was that the know-how fund has been tremendously welcomed by all the countries that are favoured by it. It is a great credit to my right hon. Friend the Minister of State and to my right hon. Friend the Foreign Secretary that they have come up with the package. The delegates from Czechoslovakia and Poland very much hope that more investment will follow the British know-how.
I spent election day in Czechoslovakia in the Civic. Forum headquarters. In that country, it is not a matter of pushing at an open door; it is a matter of walking right through the door frame. Those people desperately want British investment because they are frightened to a certain extent of German investment. In the Sudentenland they are particularly worried that too much German influence will come across the border and will damage their independence.
I was in Poland last year and I was aware that the Polish people are worried that the disproportionate amount of West German investment in Poland, and particularly in Silesia, is affecting their independence. That view was confirmed at the conference. There is great scope for British investment in those countries.

Mr. Budgen: Does my hon. Friend agree that the important point about private investment is that it is likely to change the political and economic structure of the recipient country because only by changing will it attract that investment? On the other hand, public investment is more likely to shore up the existing political circumstances and prevent change.

Mr. Tredinnick: I accept my hon. Friend's point, but we must differentiate between different types of aid.
The delegates at the conference also wanted the English language to be the paramount international language in eastern Europe. Anything that we can do to develop and improve the English language in that area will be most welcome. That was particularly evident when I spoke to Czechoslovak delegates. Delegates were also very concerned about the environment. Britain has a great role to play in that respect.
If my right hon. Friend the Minister of State were to consider the problem with visas, he could ease the relations between the countries. We visited the embassy in Prague on a Sunday and saw the embassy staff working overtime to process visas for Czechoslovak citizens wishing to come to Britain. We must review our policy towards eastern Europe. The east Germans and the west Germans have dispensed with all visa controls. We must move ahead and consider doing the same.
It has been said this afternoon that there is a strong argument for not throwing money down the well, putting it down the plug hole or throwing it at ancien régimes. However, the House must differentiate between different types of assistance. An article in The Economist this week


also suggested that we should not repeat mistakes that were made in the past by providing aid to countries which just wasted it.
There is a case for extending the know-how fund, and I shall explain how it should usefully be done. During the conference at Lancaster house, I took great care to spend time with the Russian delegation, because it was the largest from eastern Europe—there were six recently elected Members of Parliament and a member of the Praesidium. Afterwards, I entertained the delegation privately in the evening. I sat next to the Russian ambassador at lunch at the Russian embassy but two weeks ago. It is my conviction that the Russians are anxious to move closer to Britain, and they want to do so for several reasons. First, they still feel a bond between our nations. It pre-dates the 40-year cold war—it goes back to the fact that we were allies in the last war. Secondly, they believe that our nation can deliver reform. Thirdly, they recognise the success of our privatisation ideology.
It is my profound belief that we would be mistaken if we did not extend the know-how fund to the Soviet Union in a specific way. I am not suggesting that all the reforms in the Soviet Union that should take place have taken place, but, when a reformist leadership is under great pressure, the very least that we can do is to offer something so that the Soviet leader can say to the people, "We really have support; it is tangible." We could give help with desperately needed English lessons—that help would not go into the war machine—and we could help with training in western accountancy methods.
I now refer to the pace of change within the EEC and what should be done about it. In his moving speech, the right hon. Member for Plymouth, Devonport (Dr. Owen) addressed the way in which the EEC is looking at eastern Europe. I agree with him 100 per cent., but I go a little further. Not only should Czechoslovakia, Poland and Hungary be within the EEC, but it behoves the EEC to move much faster to achieve that end. We have just seen the west Germans mobilise a tremendous effort to effect change in their country. In Poland, the Catholic Church built churches as soon as restrictions were lifted. There have been vast changes in the Soviet Union also. The EEC must move faster. It is no good saying that we must wait three or four years before other applications are processed. We must consider setting up some structures much sooner than that.
I am grateful to hon. Members for listening to my speech.

Mr. Robert N. Wareing: I am glad that there have been at least one or two mentions of the problems facing Romania. I was a member of the Inter-Parliamentary Union delegation which visited Bucharest, Timisoara and Lipova, and many villages in that country. I was able to confirm what our local government officials had said of Romania. There was also a 75-man delegation from the United States. As far as we could tell, in the circumstances, the election was carried out in a perfectly just way. On 20 May, the people of Romania went to the polls in a spirit of freedom. They argued among themselves about the respective merits of the parties. I was accompanied also by the hon. Member

for Derbyshire, South (Mrs. Currie), and we were of the opinion that, even if there were procedural problems, there was nothing sinister on election day.
I recognise, of course, that there were certain events in Bucharest when miners—party vigilantes—were brought in, and all hon. Members will deplore that. Someone must tell President Iliescu that democracy does not depend entirely on what happens on election day—there must be a spirit of tolerance. Perhaps some tolerance will be imbued by inviting Romanian Members of Parliament to this country to show them that, although we may slander one another across the Chamber, we can have civilised political debate. There must be a price to pay for the lack of tolerance in Romania.
It would be wrong to exclude Romania from the know-how fund or from any other economic and social assistance that we can give. Anyone who has seen the children's hospital in Timisoara knows of the urgent human needs of the children and the conditions there. The floors of the kitchen are swilling with germ-ridden water. There is an urgent need for assistance.
The Government must act alongside Romanian politicians. We know that 20 May was a great day of hope. We recognised that it was the beginning of Romanian democracy. Romanians have never known democracy, no matter what regime was in power.

Mr. Harry Barnes: Will my hon. Friend give way?

Mr. Wareing: I shall not give way as there is insufficient time.
I remind the Government that, when they consider human rights as a condition of assistance, they must bear in mind that we do not withhold assistance from Turkey. In the estimates, we find that, even after the events in Tiananmen square, the Yue Yang power station in China will consume £3·5 million this year and £47·9 million in future years. I ask the Government to bear that point fully in mind. Country house seminars are one thing, but they are not all that is available from Britain. We need drive on the part of British business to invest in eastern Europe.
I was chairman of the economic development committee on Merseyside county council. I hope that the Government will not advise the Romanian Government on how to dissolve Bucharest city council as they dissolved the Greater London council. That would not be a lesson in democracy.
Some of our small business men went to the Hanover trade fair. We must use the facilities in Leipzig, Zagreb and other parts of eastern Europe. British business is led by laggards—people more interested in asset stripping than in real investment. That is true in this country and wherever British business features in other parts of the world. We want real drive for real investment, which will not only be to the economic advantage of the United Kingdom but will help to restore the lives of many people in eastern Europe. I ask the Government to act alongside Romanian Ministers and talk to them. Of course there will be conditions, but we should not dissolve all aid.

Mr. Donald Anderson: This debate has been based in part on the valuable report produced by the right hon. Member for Guildford (Mr. Howell) and his Select Committee. The debate has been wide-ranging,


consensual, constructive and informed, as was demonstrated by the speeches by the hon. Member for Bosworth (Mr. Tredinnick), with his experiences in Czechoslovakia, and by my hon. Friend the Member for Liverpool, West Derby (Mr. Wareing), who pleaded that Romania be not left out of consideration.
As the hon. Member for Arundel (Sir M. Marshall) has said, the Inter-Parliamentary Union has played a large part in building bridges and in providing facilities for hon. Members to see at first hand the dramatic events taking place in eastern and central Europe. We all welcome those changes, although the dramatic nature of developments has revealed some of the darker aspects of the past on the eastern side of our continent. My hon. Friend the Member for Hackney, North and Stoke Newington (Ms. Abbott) spoke about that.
Fears have been expressed about the danger that aid to the third world will be sidelined to eastern and central Europe. One sees that trend in the deployment of foreign service personnel, a matter which was mentioned in the Select Committee report. I commend to the Minister the idea of uncoupling aid to eastern and central Europe from the overseas development vote. Perhaps he would consider a separate unit based on the British Council precedent. That would make quite separate the very different areas of the third world and eastern and central Europe. As my hon. Friend the Member for Hackney, North and Stoke Newington said, the third world finds it increasingly difficult to attract private capital. Eastern and central Europe have human and physical infrastructures which make them highly attractive to private capital, some of which is employed in an abrasive and voracious manner.
We must decide how best to respond to the many needs of the eastern part of our continent. There is general recognition that political changes in the past six months must be underpinned by economic changes. That means providing the management and accountancy training which are part of the know-how funds on which the debate has concentrated. The genesis of those funds was in June last year, when the Prime Minister met General Jaruzelski and promised to provide Poland with training and advice on political pluralism and the market economy. Political changes in the rest of the region have extended those concepts.
We broadly welcome what has been done within the ambit of the know-how funds, although we are understandably wary about the Prime Minister's enthusiasm for privatisation, which at times conjures up visions of the Adam Smith Institute careering around eastern Europe organising seminars on the image of Thatcherism or seminars at which Lord Young lectures east Europeans on honesty and transparency in privatisation. Perhaps the Secretary of State for Transport, bless him, could talk about competence in privatisation and how to bring the continental railway system up to the standard of British Rail.
The know-how funds are but one part of an overall package of assistance which includes the Development Bank and the Lubbers proposal from the energy committee at the European summit which was pressed by the right hon. Member for Plymouth, Devonport (Dr. Owen). It also includes trade—are we prepared to open our markets to products from eastern and central Europe? It includes debt reduction and the range of activities which the hon. Member for Arundel and other hon. Members have set out on behalf of the Inter-Parliamentary Union.

We acknowledge the way the Government have worked in concert with the advisory body. The Minister said that the Government had learnt from their mistakes in the early operation of the know-how funds. It would be interesting to hear about those mistakes, because the projects which have come forward since that admission by the Minister seem strikingly similar to those which came forward in the first part of the operation.
There are reservations about the implementation of the funds. One concerns the degree of co-ordination and who directs it. Will it be done by the group of 24 or by the European Community? Such co-ordination is necessary if we are to avoid stumbling over one another in the desire to help eastern and central Europe. Questions have been asked about amounts of money. Perhaps the Minister will confirm that about £2 million of the total pledged at the end of May has been disbursed. In the context of the debt and the need, that is small beer.
Some hon. Members have asked about the narrow profile of democracy and multi-party politics that the Government have adopted—a point in relation to Professor Dahrendorf and his social society. There is a need for intermediate bodies because democracy involves diversity and not just bankers and accountants flocking to eastern Europe. Will the Minister say at what point he thinks that East Germany, after yesterday's economic and commercial union with greater Germany, will no longer be able to benefit from the know-how funds? Perhaps he will also talk about the relationship of the funds, if any, to the Soviet Union's enormous needs. That has been mentioned by several hon. Members.
As funds are limited, have the Government considered the know-how funds as pump primers? Companies which will benefit could surely make a contribution to enable Government funds to go that much further. How much liaison is there with business? A major British company to which I spoke says it thinks that the Government have been insufficiently commercial. Perhaps in terms of distribution Britain has had the short end of the stick in that we have been assigned financial expertise, the benefit of the City, while other countries have been assigned areas in which commerce is more evident. I hope that the Minister will confirm that we have not been short changed.
The Minister will be aware of the criticism contained in a recent article in The Times. It suggested that France has been more successful in setting up institutions for teaching banking in Poland, whereas the seminars that we have promoted have been of much less benefit. Tourism has many benefits, not only because it employs many people but because it will earn foreign exchange. Yet know-how funds have been directed to only one small tourist project in Cracow. The Minister should look at the claims of tourism.
The Opposition welcome the scheme as far as it goes. It is but a small part of a panoply of measures which seek to cope with the changes in eastern and central Europe. Those changes are wholly unprecedented and are turning a command economy into one in which the market will have a place, albeit in a social context. We are ready to co-operate with the Government but, as I have said, we shall be wary of any attempt to mould eastern and central Europe in the image of Thatcherism. We are reassured by the fact that the Minister of State, Foreign and Commonwealth Office, the right hon. Member for Bristol,


West (Mr. Waldegrave), is in charge of the programme, making it less likely that a narrow ideological vision will prevail.
We stress the need for flexibility. The Government should not take the view that all the countries in eastern and central Europe have the same problems. They should pay attention to each of the countries and policy should be subject to constant review. When there is a change of Government, we shall try to ensure that the right hon. Member for Bristol, West remains a member of the advisory committee. In working with the Government on the matter, our objective is to target aid and assistance as well as possible and to improve its scope.
With all the reservations that I have mentioned, we give a broad blessing to the know-how funds.

The Minister of State, Foreign and Commonwealth Office (Mr. William Waldegrave): I am grateful to the hon. Member for Swansea, East (Mr. Anderson), although I am not at all grateful to him for his unfortunate remarks about me personally at the end of his otherwise admirable speech. On a more serious note, I greatly welcome the tone of what he said.
The introduction to the debate by the Chairman of the Foreign Affairs Select Committee, my right hon. Friend the Member for Guildford (Mr. Howell), was exemplary, as was the Committee's report, which was extremely useful to us on a number of counts. I wish that I could say the same for the speech of the hon. Member for Cynon Valley (Mrs. Clwyd), which was mildly deplorable. To mock her colleagues and ours for going to find out about the eastern European countries seemed sad. To say that one must listen to the people on the ground but not go to the countries seemed odd. She then spent several billions of pounds and we look for the normal rebuttal from the right hon. and learned Member for Monklands, East (Mr. Smith) tomorrow.
We have had a good debate with speeches from hon. Members on both sides of the House. The hon. Member for Hackney, North and Stoke Newington (Ms. Abbott) made a good speech. My hon. Friend the Member for Arundel (Sir M. Marshall) brought us back to sense. We now have the task of helping the east European countries. We must not impose anything on them. If they are interested in privatisation, it is not because we have sought to impose it on them but because they want to diversify and pluralise their economies. The demand comes from them. They look to us because they have seen us undertake a much smaller but similar task.
The east European countries do not look to us only on economic matters. The hon. Member for Swansea, East said that, as did the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston). The institutional help that we can give to such countries is greatly valued by them. They have come to us to ask for help in setting up non-political civil services, local administrations and police forces. The industrial and commercial aspect of the debate is vital, but it is not the only aspect. The know-how funds were not set up solely as a commercial and industrial support operation. I hope that we shall use them, fairly, as much as we can in the interests of this country to bring business here. The problems posed by the moral and institutional

wastelands left by the communists, as well as the environmental wastelands referred to by several hon. Members and the commercial and financial wastelands, are a much more difficult aspect.
The right hon. Member for Plymouth, Devonport (Dr. Owen) made a powerful speech. I agree with him that we must be absolutely clear that if the eastern European countries manage to put their economies and their institutions into free and democratic shape, the Community will welcome them. I take a slightly more pessimistic view than him about the time scale in which that might be possible.
When we compare the transition to democracy in the eastern European countries with that which took place in Spain, it is clear that, although the political rebuilding when a country escapes from communism is similar to that when it escapes from fascism, the economic rebuilding is more difficult. Some elements of a free economy existed under fascism in Spain and Portugal which greatly speeded their transition. That has turned out to be a fact.
The relationship of the eastern European countries with the Community is vital. Opposition Members are mesmerised by the Prime Minister and bring her into their speeches frequently. It is extraordinary how easy I find it not to mention the Leader of the Opposition in my speeches. The Prime Minister is leading the battle, with help from Holland, Germany and other countries, for an open trading system and a liberal trading Community. That is far more important to the interests of the eastern European countries than anything else that we could do. It has turned out that Lenin's old joke about the capitalists selling the communists the rope with which to hang themselves was wrong in every respect. First, they managed to strangle themselves with the rope and then they did not pay for it.
I noticed the hon. Member for Workington (Mr. Campbell-Savours) nod from a sedentary position during the debate when the concept of differentiation was mentioned. It seems absolutely right that there should be differentiation in the jargon. We should try to relate our support to the development of the institutions which the reformers whom we supported in the years of communism sought to build. Those reformers urged differentiation on us. We have not thought it up for ourselves. That is why there is hesitation about giving aid to the Soviet Union, and it is right that there should be. We do not say that we should never offer support, but we should offer support that helps the transition to new institutions and does not simply undermine the forces that are pressing for change. If we simply pay to put consumer goods on the shelves for a year or two, we shall have done nothing to help produce more consumer goods in the long term. We are not saying no. We are saying yes. In the words of my right hon. Friend the Member for Guildford, if we can be assured that the analysis has been done and that the money that we put in will help the transition, we shall consider it seriously.
I have referred to the European Community, which has a crucial role to play both as an ultimate target for the eastern European countries and in the meantime in our association agreements to provide markets in which the liberalising economies can sell their goods. Other multinational and multilateral organisations are vital. First, there is the European Bank for Reconstruction and Development, which we shall welcome to London with its French chairman. We agree with the Select Committee's


recommendaton that the EBRD should be paid out of the Overseas Development Agency eastern European support line and not out of the multilateral organisations line.
The EBRD will be one of the key institutions. Conditionality will work with it in relation to the Soviet Union at least at the beginning. That has been made clear by its founding members and it is right. It is vital to achieve international co-ordination on the broad thrust of the work of the group of 24. That work is being done for the first time in a wide forum by the Commission of the European Community. That is a considerable step in showing how central the EC is to all the changes taking place. Commissioner Andriessen has done extremely well in the work that he has undertaken.
The hon. Member for Liverpool, West Derby (Mr. Wareing) made a good short speech about Romania. I agree with him that we should not cut off contacts with the Romanians. On the contrary, we should show them what we mean by democracy, which we criticise them for not yet having established. Before it becomes established as part of the folklore, I emphasise that Conor Cruise O'Brien was wrong to say that I said that President Iliescu was indistinguishable from Ceausescu. I carefully did not say that. I said that it was depressing that some of the methods used were exactly those used by Ceausescu and that that shook us, but we still asked our ambassador to go to the inauguration to show that we recognise the enormous step forward that has been taken by holding an election.
We do not believe that Romania yet meets the criteria for the know-how funds. We hope that we have sent a sharp signal by not inviting it to the first group of 24 meeting. We hope that that shock produces results. We do not want to push Romania out. We hope that the shock will encourage Romania to do things that will enable us to bring it in. I hope that both sides of the House agree with that.

Mr. Harry Barnes: Will the Minister give way?

Mr. Waldegrave: We had 40 minutes of speeches from the Opposition Front Bench during my right hon. Friend's debate, so I cannot give way if other hon. Members wish me to comment on their speeches. I am in the hon. Gentleman's hands.
There has been a major operation in the multilateral forums, with the Community at its centre, to respond to events in eastern Europe. As the right hon. Member for Devonport said, the security aspects of changes in eastern Europe are far more important than much of what we laboured to negotiate in the Vienna arms control negotiations, important though those negotiations were. If we have a group of free, democratic, economically successful countries at the centre of Europe, it will do far more for our security than any negotiations about a few hundred aircraft or tanks. That is why events at the NATO summit this week are crucial. The multilateral security negotiations are not irrelevant to the debate.
I now come to what we have tried to do bilaterally. First, there are the know-how funds. It was unfair of the hon. Member for Cynon Valley to quote from The Economist only the critical remarks. She quoted the following passage:
The most stinging complaint is simple: for expertise read fripperies.
In fact, The Economist set out the criticisms and then knocked them down. Unfortunately, the hon. Lady did

not quote the knocking-down passages. Her research assistant was either idle or unfair. I shall right the balance by quoting the final paragraph of the article. It reads:
Many of the business men who have brushed with the fund have been impressed. They agree with its view that eastern Europe needs know-how even more than cash, and they generally endorse the fund's decision to make aid conditional upon countries holding free elections and introducing free markets.
The hon. Lady may not like the following passage:
Why not extend the good idea, several have asked, and apply the same conditions to debt-ridden dirigiste countries in the third world?
I shall reply to Mr. Boyes, who I do not consider to be one of the leading commentators on these matters, with the opinion of the man who, along with Timothy Garton Ash, is the best writer on eastern Europe—Neal Ascherson. On Sunday 3 June, Mr. Ascherson wrote—I commend hon. Members and the hon. Lady's research assistant to read the article—
The know-how fund, aware of this, warns its experts not to be too British in their approach. It is a limitation but no other western country anxious to assist infant democracies in eastern Europe has produced anything half so adaptable. Here is the starving man. There is the pig. The British response is to offer him neither a pistol nor a tub of apple sauce but a cooking pot.
I like it.

Mr.Sedgemore: rose—

Mr. Waldegrave: The hon. Member has spoken already at enormous length and has delighted us all with a range of sedentary interjections throughout the afternoon.

Mr. Sedgemore: If the know-how fund is beyond criticism, as the Minister is saying, why are staff in the embassies in eastern Europe criticising it so severely?

Mr. Waldegrave: I accept that the know-how fund is not beyond criticism. Indeed, I am about to make some criticisms of it. The hon. Gentleman has produced another example of how he does not facilitate our debates. During the last financial year we spent about £2.5 million on the fund. We were spending money as we were setting up the organisation. I am well aware of the justified criticism that was made—the customer is not always wrong—that it was not always easy to learn how to contact the fund and to ascertain the criteria. Those difficulties arose because we were setting the criteria as we went along. I am willing to believe—this may be astonishing to some—that the fund is not perfect yet. However, it is becoming very much better by the day and more and more satisfied customers are writing to tell me that. As the hon. Member for Swansea, East said, it is in the interests of both sides of the House and of the country generally that we get the fund right. We shall listen to criticism and try to put things in order. The structure of the fund has become considerably better. That is why people like Neil Ascherson write as they do.
The hon. Member for Cynon Valley criticises Ministers for visiting eastern Europe. I shall rebut her argument. One of the purposes of the know-how fund is to involve every Whitehall Department in using British expertise in the round. It should not be the Foreign Office alone that is involved. In some ways the know-how fund is unique.
My right hon. and learned Friend the Secretary of State for Employment has been to each of the countries that are involved with the know-how fund. We have the skills for which they asked and they have been deployed by officials of the Department. The three countries wanted to know


how to set up small businesses and how to diversify from collapsing major capital-intensive industries into new industries. I pay tribute to my right hon. and learned Friend and his Department for taking on new work and performing extremely well.
The same comments can be made about agriculture. It is necessary for contacts to be made at ministerial level. My right hon. Friend the Minister of Agriculture, Fisheries and Food has visited several countries. In Poland, for example, there is a scheme worth £50 million which will meet exactly the purpose for which the Poles asked. They want small productive businesses effectively to distribute the food that at present never reaches the shops.
My right hon. Friend the Secretary of State for Wales and a team of Department officials have helped, as they were asked, to advise and assist on and with local government administration. That is another example of sensible assistance. Other schemes have focused on police training in Poland and environmental matters. Some of these activities have been almost too big for the know-how fund. The fund, with British utilities, has been undertaking some work, but the big capital spending must come from multilateral organisations such as the World bank and others. We are doing a little where we are requested to intervene.

Mr. Campbell-Savours: Are any discussions taking place with Soviet authorities about the transfer of agriculture technology and managerial expertise to improve distribution in the Soviet Union? Would not that be a major contribution to resolving the distribution problems of the Soviet Union?

Mr. Waldegrave: Those who want us to rush at the Soviet Union should understand that that country has not yet asked for anything. It might be polite to wait until it does. If we were to get involved, I would have a personal bias in favour of exactly what the hon. Gentleman suggests. Some of the elements are already in place. For example, ICI has been working for the Soviet Union to try to help that country to develop agriculture, especially in distribution and retailing. I can imagine that a sectoral project would be attractive. I am speaking personally and far ahead of any analysis. I am sure that note will be taken of the hon. Gentleman's suggestion.
I note the views of the Select Committee, whose Chairman is my right hon. Friend the Member for Guildford, on the range of projects that should be supported by the fund and on the range of organisations and individuals that should be consulted. The point is well taken. There is no shortage of proposals, and that is partly why we are attracting some criticism. When individuals are turned down, they sometimes write to their Members of Parliament to tell them that it is scandalous that certain projects have been rejected. That is not an unknown phenomenon when dealing with aid. We should do better with our publicity, and any criticism of it is valid. We are trying to bring some thought to bear on improving it. We wish to make it easier for those who have never had any experience of eastern Europe or of aid products to get in touch with the know-how fund.
I note with interest the suggestion of my hon. Friend the Member for Arundel that a general stocktaking seminar should take place in due course—perhaps after six months,

for example—to be attended by a range of the organisations involved so as to ascertain whether there is adequate co-ordination. That might be a job for the Great Britain-East Europe Centre, which is so ably chaired by my hon. Friend the Member for Carshalton and Wallington (Mr. Forman). The speech of my hon. Friend the Member for Carshalton was succinct and right on the ball. The same can be said of the speech of my hon. Friend the Member for Bosworth (Mr. Tredinnick), who referred to the problem of visas.
The bilateral programme—I have referred already to multilateral agencies—starts with the know-how fund and then moves on to a difficult job that will take years to complete, which is to shift the general diplomacy of the United Kingdom so that it occupies a rather more eastern-Europe-oriented stance. I think that the Foreign Office has done well already. It has found 60 new London-based or locally engaged staff. That is not a bad record in such a short time. It is not easy to transfer that number of staff so quickly. We are looking for 37 more staff by the end of 1992. At a time of necessary expenditure constraints, we are having to impose some strains elsewhere. Surely it is right to shift these people. As I have said, the Foreign Office is moving.

Mr. Anderson: Will the Minister give way?

Mr. Waldegrave: No. I have only three more minutes in which to bring my reply to an end.
We shall ask the British Council to undertake a good deal more, I am certain, on the English language front. I cannot say more than that now. Negotiations and discussions are taking place. As my right hon. Friend the Secretary of State has said, we should respond, with Canada and the United States, to the explicit desire of the countries in question to replace Russian as their second language with English. We shall not do it all ourselves but we must make a contribution. We are doing so already with specific projects through the know-how fund. These projects are aimed at providing English language training for those whom the know-how fund wishes to involve.
The British Council should take the full weight of the major expansion, and that is something that we shall have to consider in future.
As my hon. Friend the Member for Bosworth and the Select Committee on Foreign Affairs said, visas will represent another change in the relations of British institutions and British Ministries with eastern Europe. Like other hon. Members, I am all too conscious of the continuing strain that is put on our relations with eastern European countries because of the pressures that are brought to bear by the application for and granting of visas. We shall do what we can to simplify and to provide a quicker service, but we must examine each country individually and judge separately the case for each country to determine whether, at the right time, we can abolish visas entirely or in part. That would be much the best way of dealing with the problem in general. We must look carefully at the interests of our country before we do so.
Our bilateral help is additional to and separate from the United Kingdom's overseas aid budget for developing countries. The hon. Member for Swansea, East asked that such aid should be treated separately. My right hon. Friend the Minister for Overseas Development has already said that that aid is a separate item in the ODA budget. I am sure that the hon. Gentleman welcomed that.
The hon. Member for Cynon Valley was right in saying that there is anxiety in the third world about the fact that private capital may go to eastern Europe, but there is nothing that she or I can do about that. The only people who can do anything are those responsible for financial policies in third-world countries who will now have to compete against Europe.

It being Seven o'clock, MR. DEPUTY SPEAKER interrupted the proceedings, pursuant to paragraph. (3) of Standing Order No. 52 (Consideration of Estimates).

Clyde Port Authority Bill

Order for Third Reading read.

7 pm

Dr. Norman A. Godman: On a point of order, Mr. Deputy Speaker. I seek your assistance as I am given to understand that when the Bill was scrutinised by the Committee on Unopposed Bills, counsel for the Clyde port authority mentioned amendments that were to be made to the Bill in another place. If the hon. Member for Eastwood (Mr. Stewart) were to catch your eye, Mr. Deputy Speaker, would I be in order to ask him to outline the proposed amendments apparently to be made in another place?

Mr. Deputy Speaker (Mr. Harold Walker): I can neither anticipate nor comment on what might happen in another place. Tonight we are debating Third Reading and I hope that the House will stick to the normal confines of that debate and comment on what is in the Bill.

Mr. Stuart Bell: On a point of order, Mr. Deputy Speaker. Are you aware that the Government have introduced a Command document, "Private Bills and New Procedures"? It is a consultation document, dealing with the private Bill procedure. Are you further aware that, tonight, we shall be discussing a Ways and Means resolution dealing with the levy on port privatisations, which directly affects the Bill now before the House?
I do not wish to detain the House, but given that the Government are about to change the rules and regulations by which we debate private Bills and that there is a money resolution before us that deals with the Bill, has any representation been made to you, Mr. Deputy Speaker, to defer the Bill pending the completion of the Government's consultation? Given that this Bill is truncated and that it will be followed by a Ways and Means resolution dealing with the same Bill, is not the Bill hybrid? Surely we should seek your protection.

Mr. Deputy Speaker: My answer to the hon. Gentleman is yes and no. Yes, I am aware of the document to which he refers, but the House has yet to debate it and make decisions on it. It will be for the House to decide on any changes that may be made to the private Bill procedure. At the moment we are dealing with the procedure as it is. No representation has been made to me about the hybridity of the Bill.
The Ways and Means resolution does not deal specifically with the Bill, but is of a general nature. When we get to it the hon. Gentleman may seek to catch my eye and comment upon this Bill. He cannot do it the other way round—he cannot anticipate what the House may debate and decide later.

Mr. Martin Redmond: Further to that point of order, Mr. Deputy Speaker. You will recollect that we raised the question about the Bill's hybridity on a previous occasion, but tonight I am seeking your guidance on the Government's involvement in the Bill. It is supposed to be a private Bill and the Government should not be seeking to interfere. I find it rather strange, therefore, that yet again the Government have sought to ensure that a three-line Whip operates after the debate on the Bill. That ensures that they have sufficient troops—

Mr. Deputy Speaker: Order. That has nothing to do with the Chair.

Mr. Redmond: In view of the obvious Government involvement and further to the point of order raised by my hon. Friend the Member for Middlesbrough (Mr. Bell), would not it be correct to suspend the private business until the report on private Bill procedures has been debated? That would ensure that we had a sensible and sane method of dealing with private business.

Mr. Deputy Speaker: That is not a matter for me.

Mr. Bell: Further to that point of order, Mr. Deputy Speaker. I omitted to mention in my first point of order that when I asked the Lord President of the Council on Thursday whether we could have an early debate on the document dealing with private Bills, he said that there would be no such debate. That is why I sought your protection, Mr. Deputy Speaker, as you are the only one who can protect us from debating a Bill, the basis of which will be subsequently changed by the Government.

Mr. Deputy Speaker: The Bill before the House will be dealt with by the procedures as contained in appropriate Standing Orders. The question of future changes does not have any bearing on our proceedings.

Mr. Tony Worthington: Further to that point of order, Mr. Deputy Speaker. We are faced with a strange situation because the Bill that we are to debate will not be anywhere near the Bill that will be enacted, given that I understand that the counsel for the promoters and the sponsor said that the Bill would not be competent unless particular amendments were made. The promoters have given an undertaking that that will be put right in the House of Lords, but that means that we shall not have the opportunity to debate the Bill in the form intended by its promoters and sponsor.
The Government have said that the Bill is private, but they have said that amendments will be made to the Finance Bill to deal with 50 per cent. of the proceeds of the sale of the Clyde port authority. The Bill that we shall discuss tonight is not that which will be enacted. Is that in order?

Mr. Deputy Speaker: It is not unusual for public or private Bills to go to another place and be amended. If that happens—the hon. Gentleman seems to have more information than me—those amendments will return to the House so that it will have an opportunity to comment on them. It might make sense if we allowed the hon. Member for Eastwood (Mr. Stewart), who is in charge of the Bill, to address the House as he might be able to throw some light on these matters.

Mr. Frank Haynes: Further to that point of order, Mr. Deputy Speaker. You are the Chairman of Ways and Means and we all respect that position.

Mr. Deputy Speaker: Few ways and little means.

Mr. Haynes: In reply to my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington), you said that you did not know what was going on, but we do. Not many moments ago a broadcast was made about the Bill—the Government have struck a deal on this private Bill. You are the Chairman of Ways and Means, but you obviously do not know what is going on.

Mr. Deputy Speaker: indicated assent.

Mr. Haynes: I note that you are in total agreement with me, Mr. Deputy Speaker. You are not in the picture and you must be told. The Government are pulling a fast one. The Government have whipped in a payroll vote because of the deal that has been struck. We Back Benchers need protection because that sort of thing goes on far too often. I do not represent Scotland, but I am interested in the Bill because of the unfair way in which the Government have acted.
You, Mr. Deputy Speaker, must take due note of what is going on and I am looking for some action from you. I respect your position and I support you in the many things that you do, but I hope that you will give Back Benchers support now because of the Government's fiddle on the Bill.

Mr. Deputy Speaker: I am grateful to the hon. Gentleman, who, as always, gives me much more protection than I can offer him. Every day in this place I find people doing all sorts of things about which I should be informed but which I never learn about except at second or third hand. I suppose that that is part of the facts of parliamentary life. I have no responsibility for what the Government may be doing about organising votes. We should get on.

Mr. Robert Hughes: Further to that point of order, Mr. Deputy Speaker. I am sorry, but some of us are confused about this. We all understand perfectly well that Bills are introduced in the House or in another place. As they proceed, amendments are moved, but if, as is suggested, a Bill is to be introduced in the House to which major amendments are, apparently with the agreement of the Bill's sponsors, to be added at a later stage, surely the proper procedure is that the Bill should be withdrawn and the amendments that have been agreed placed on the face of the Bill where we can all see them. If not, it will be a totally unreal debate.
I have no axe to grind. I do not know whether I shall vote against or for the Bill. But in exercising a choice, as we all have to do, we should be able to make our choice based on the facts of the matter and the face of the Bill. If there are deficiencies in the Bill that must be put right in another place, surely the correct procedure is to withdraw the Bill and bring it back later so that we can all see, in the Bill, what is going on. That way, we can make more progress and better sense.

Mr. Deputy Speaker: The correct procedure is that laid down in the Standing Orders that we are following this evening. I have told the House that I have no knowledge of those amendments. If they are thought appropriate, they may well be moved in another place, but it is not for

me to comment on or anticipate what may happen in another place. If the Bill is amended in another place, those amendments will, under Standing Orders, be returned to this House. Instead of continuing to speculate about possible amendments, it may be more sensible for the House to listen to the hon. Member for Eastwood, who might enlighten the House about what amendments may be forthcoming and their extent.

Mr. Haynes: Further to that point of order, Mr. Deputy Speaker. With respect, you keep mentioning the other place, but we are dealing with this place at present, and we are not getting a fair deal. I remember when you sat on the Back Benches, at the Opposition Dispatch Box and at the Government Dispatch Box when you were a first-class Minister, and you know as well as me what goes on in here. We are asking you for help because we need a blockage as the Government are getting away with murder. It is high time that you grabbed the nettle, because we are not satisfied. We always look to the Chair for help and we are looking for help from you. We are not bothered about the other end because the Bill is not there yet. It is in here, which is where we are dealing with it right now. We want you to do something about it.

Mr. Deputy Speaker: I am bound by Standing Orders, as is the House, and I am following the requirements of Standing Orders.

Mr. Worthington: Is it in order, Mr. Deputy Speaker, for someone moving a private Bill to circumvent one of the stages of consideration in the House by agreeing to introduce major amendments that counsel for the hon. Member for Eastwood (Mr. Stewart) said were essential for the Bill to progress? Is it in order to circumvent a stage of consideration in the House by giving an undertaking of which you, Mr. Deputy Speaker, are unaware, as are most hon. Members, so that the Bill may proceed more rapidly through both Houses of Parliament? Is not that underhand?

Mr. Deputy Speaker: I thought that I had dealt with those matters.

Mr. Redmond: On a point of order, Mr. Deputy Speaker. May I have some clarification? There has been a fair amount of criticism from Conservative Members about private Bills in this place, and we have a classic example now. I stand to be corrected but I believe that when such a Bill starts off, it goes through the usual scrutiny of the Private Bill Office, is advertised and, if unopposed at 2.30 pm, proceeds to its next stage. Would not the proper place for those so-called amendments to be made be in the Committee on Unopposed Bills? Not to do so is to mislead that Committee and the House by seeking to give a defective Bill a Third Reading. Can you, Mr. Deputy Speaker, seek advice from the Clerk at the Table on whether the correct procedure has been followed and whether those amendments should have been made in the Committee on Unopposed Bills? They have not suddenly come to light, and the Government and the Bill's promoters are misleading the House and seeking to destroy your office, Mr. Deputy Speaker.

Mr. Deputy Speaker: I do not have the detailed knowledge that some hon. Members seem to possess of what went on and what was said in the Committee that dealt with the Bill. I can only tell the House, not for the


first time this evening, that what we are doing this evening is perfectly in order, conforms with Standing Orders and is not an unusual practice. Should their Lordships find it necessary to amend the Bill, they will discuss and decide on their amendments, which will then come before this House. I repeat that I have no knowledge of such amendments, and it is not for me to anticipate what may be said or done in their Lordships' House.

Mr. Bell: Further to that point of order, Mr. Deputy Speaker. It is a valid point of order.

Mr. Deputy Speaker: The hon. Gentleman says that it is a valid point of order. I hope that it is much more valid than some of those that I have had to endure so far.

Mr. Bell: I draw your attention, Mr. Deputy Speaker, to "Erskine May," which states on page 861:
If any stage of a bill is proceeded with when the notice has not been duly given, or the proper interval allowed, or if notice is taken of any other informality, the proceeding will be null and void, and the stage must be repeated.
I respectfully submit that the Government's publication of a new document invalidates the proceedings so far, in accordance with "Erskine May", page 861, and I invite you, Mr. Deputy Speaker, to suspend the sitting until you have had time to scrutinise the matter carefully.

Mr. Deputy Speaker: I thought that I had dealt with that point earlier. The document to which the hon. Gentleman referred and which he held up is not before the House at present. We should get on.

Mr. Jim Sillars: On a point of order, Mr. Deputy Speaker. It arises out of your ruling. You rightly say that you are not officially aware of any amendments to be tabled in the other place. However, if the hon. Member for Eastwood (Mr. Stewart), during his opening speech in the next few minutes, tells the Chamber that he is aware that amendments will be tabled in the other place, does not that alter the basis of your ruling?

Mr. Deputy Speaker: Not in the slightest.

Mr. Allan Stewart: I beg to move, That the Bill be now read the Third time.
The issue before the House this evening is fairly straight forward. The Bill received its Second Reading on 14 May with a substantial majority. There are no petitions against the Bill; in particular, there are no petitions from the riparian local authorities, which have been—

Dr. Godman: Is it or is it not the case that some hours ago the hon. Member for Eastwood (Mr. Stewart) swore an oath of allegiance to the Secretary of State for Scotland in relation to the Law Reform (Miscellaneous Provisions) (Scotland) Bill and, in return, was promised the payroll vote tonight?

Mr. Stewart: I am not sure whether it is in order for me or not—[interruption.]—for me to reply.

Mr. Haynes: On a point of order, Mr. Deputy Speaker. This is a serious matter. I think that you should find out exactly what has happened because I smell a rat here—there is a right fiddle going on. You, Mr. Deputy Speaker, must find out exactly what is going on.

Mr. Deputy Speaker: The best way of finding out what is going on is to listen to the hon. Member for Eastwood (Mr. Stewart).

Mr. Haynes: The hon. Member for Eastwood (Mr. Stewart) has not answered the question.

Mr. Stewart: I am going to. If it is in order for me to reply to the question put by the hon. Member for Greenock and Port Glasgow (Dr. Godman), I can assure him that, to the best of my knowledge, Scottish Television carried an interview with me some little time ago confirming that I propose to speak and vote against a possible guillotine motion on the Law Reform (Miscellaneous Provisions) (Scotland) Bill. I understand that the BBC is carrying other reports, but there we are.
As I told the hon. Member for Greenock and Port Glasgow, there are no petitions against the Bill from the riparian local authorities, which are the obvious authorities to be most concerned about the Bill, and, as it happens, are all controlled by the Labour party. I understand that they do not intend to petition against the Bill in the other place, either.

Dr. Godman: The hon. Gentleman is showing characteristic courtesy in these exchanges. Greenock water front heritage association is likely to place a petition of objection against the Bill in the other place.

Mr. Stewart: I am obliged to the hon. Gentleman, but that does not contradict what I said, which was that none of the local authorities was going to petition against the Bill. The hon. Gentleman may wish to correct me, but I understand that Inverclyde district council has decided not to petition in the other place.

Mr. David Lambie: Is the hon. Gentleman aware that my hon. Friend the Member for Cunninghame, North (Mr. Wilson) and I attended a meeting yesterday in Kilbirnie, where one of the leading councillors on Cunninghame district council mentioned a discussion which had taken place in one of the council's committees about the Bill? He reported that Cunninghame district council was taking advice, and had not yet decided whether to oppose the Bill. I think that my hon. Friend the Member for Cunninghame, North will agree that, at present, the councillors are of the opinion that they should oppose it.

Mr. Stewart: I am obliged to the hon. Gentleman for that information. The point is that none of the local authorities involved has entered a petition in this House against the Bill. There is time for local authorities to petition another place if they so wish, which answers a question that the hon. Member for Greenock and Port Glasgow asked me on Second Reading.
I wish not to repeat at length the general arguments of the debate on Second Reading but to move on to deal with some of the points raised, fairly and properly, by Opposition Members since Second Reading.
Trust ports are unusual—they are independent, they are not accountable to anyone, and their powers and sources of finance are limited, which is why the private Bill is before the House tonight.
The Clyde port authority is an historic port of immense importance not only to the west of Scotland but to the rest of Scotland and the United Kingdom and Europe. The situation of the port has changed sharply over the years,


partly because of the geographical shift of trade from the west to the east: the increase in the United Kingdom's trade with the European Community—it now accounts for about 73 per cent. of United Kingdom trade—has benefited ports in the east and the south rather than those in the west. Another factor is that we no longer import oil; the Clyde port authority handled some 12 million tonnes of imported crude from the middle east before North sea oil came on stream.

Mr. Redmond: Will the hon. Gentleman be kind enough to draw my attention to some of the alleged defects in the Bill, which may or may not be remedied in another place? If one or two parts of the Bill need tightening up, I should be grateful for an explanation of where they are and how the hon. Gentleman intends to tighten them.

Mr. Stewart: I cannot forecast what will happen to the Bill in another place. If any amendments are made, as the noble Lords are perfectly entitled to do, this House will have the opportunity to debate them subsequently.

Mr. Worthington: rose—

Mr. Stewart: I have already given way about five times.

Mr. Worthington: Is the hon. Gentleman saying that he has been so badly briefed that he does not know the contents of the amendments that are to be moved in another place which the Counsel to Mr. Speaker says are essential to make the Bill competent?

Mr. Stewart: I am making a perfectly fair and valid point, which is that the other place is entitled to make amendments to the Bill if it so wishes. If it does, the amendments must come back to the House to be considered. Only if no amendments are made in another place will the Bill not come back to this House.

Mr. Worthington: rose—

Mr. Stewart: I have already given way to the hon. Gentleman on that subject and I should like to get a little further into my speech.
The Clyde faces competition from ports on the Forth, on the east coast of Scotland, and from other west coast ports, notably Liverpool, which is privately owned but has received substantial assistance from the taxpayers, and Bristol, which is municipally owned, and which has received substantial assistance from the local authority.
The reason for the Bill—as we debated fully on Second Reading—is that the authority, like other trust ports, has to operate under the restrictions imposed by the Clyde Port Authority Order 1965. Much of the debate on Second Reading and many of the issues mentioned by hon. Members then and subsequently have centred on the question that the hon. Member for Clydebank and Milngavie (Mr. Worthington) and others mentioned on Second Reading: accepting that there are legal restrictions, what has the Clyde port authority been restricted from doing? The hon. Member for Clydebank and Milngavie asked that in a recent letter to the managing director of the Clyde port authority. I am glad to have his confirmation that my delivery of the letter to the board this afternoon resulted in him getting the reply before the debate.
I shall spend a moment or two giving the House some

practical examples of how the restrictions on the port authority's operations have hindered developments that most people would regard as highly desirable.
My first example is the development of the site bounded by Robertson street, Broomielaw and York street in Glasgow which is well known to Opposition Members who represent Glasgow constituencies. It is immediately opposite the authority's headquarters building. As landowner, the authority had the opportunity to participate in a joint development with Glasgow and Oriental Development Limited. Having taken legal advice as a result of uncertainty about its acquisition powers, the authority was unable to proceed with that joint development, and subsequently had to sell the land to Glasgow and Oriental Development Limited, which is now progressing the development without the authority as a partner. The total borrowings of the authority are restricted by statute. Any project requiring major capital investment that would result in the borrowing limit being exceeded would necessitate reversion to Parliament, with all that that entails under present legislation.
Opposition Members will appreciate that many of the projects that may have been considered involve commercial confidentiality. I shall cite a couple of practical examples of how the existing restrictions under which the Clyde port authority operates have inhibited, and do inhibit, its reasonable wish to go ahead with sensible developments. As I said on Second Reading, the authority constantly has to consult Queen's Counsel and consider whether the proposals are intra vires. That, in addition to the burden on management time, is bound to inhibit effective decision making.
As the House knows, my right hon. and learned Friend the Secretary of State for Scotland has announced that the authority has planning consent to proceed, in partnership with Tarmac Construction, with a development of about 200 acres of redundant land at Braehead, which is, I think, in the constituency of the hon. Member for Renfrew, West and Inverclyde (Mr. Graham)—[Interruption.] I am wrong; it is in one of the Paisley constituencies and close to the hon. Gentleman's constituency.

Mr. Thomas Graham: The hon. Gentleman is aware of the concern of the local elected members about the proposal to allow the scheme to go ahead. I hope that I shall have an opportunity to say something about that later. The hon. Gentleman knows that the district council is extremely concerned about that development.

Mr. Stewart: I hope that the hon. Gentleman will have the opportunity to contribute to the debate. He and I, although of different political views, have often co-operated on certain projects. I pay tribute to the hon. Gentleman's support concerning the problems in the Armitage Shanks Tubal works at Braehead.
That development will provide out-of-town shopping, leisure, housing, and commercial facilities. However, under current legislation there are doubts about whether the authority has sufficient powers to manage the development once it has been completed. The Bill would remove those doubts.
The authority wishes to join with other landowners, such as Glasgow district council, to develop land at Yorkhill quay with a consortium to be headed by a new company called Clyde Maritime. It would be a major


scheme costing about £300 million. However, under the 1965 legislation the authority is precluded from investing in that company except by selling out to a controlling interest subsequently. It cannot realise the true potential of its land in that area. Those are examples of the real and practical problems that the authority is currently—

Mr. Lambie: I remind the hon. Gentleman that the Clyde port authority is a ports authority. Can he give me any examples of restrictions on the Clyde port authority's duty as a ports authority? He has given examples of restrictions on the authority as a land developer—an exploiter of an existing asset—but other than the dock labour scheme, which is now abolished, there are no restrictions on the Clyde port authority as a ports authority. Does the hon. Gentleman now recognise that there is no need for the Bill?

Mr. Stewart: I shall mention some of the statutory requirements on the authority, but first I wish to make a general point. Only if the authority can develop all its assets fully will it have the resources to enable it to act as a fully commercial harbour and port authority. It is not in the interests of the authority's port operations for it to be unable to realise fully the value of its other assets.

Mr. Brian Wilson: Will the hon. Gentleman give way?

Mr. Stewart: I would rather continue, but as the hon. Gentleman is a Front-Bench spokesman I shall give way.

Mr. Wilson: I want to pursue the point made by my hon. Friend the Member for Cunninghame, South (Mr. Lambie). I understand the argument that, in order to bring in the money to carry out the river functions, the authority wants to realise its assets. Does the hon. Gentleman agree that a balance must be struck? Does he have any view on what proportion of the CPA's revenue should come as manager of supermarkets, leisure parks and all the other desirable or undesirable developments on its banks? Under a different ownership, at what point would its interest in such activities cease to be to the benefit and begin to be to the detriment of its marine activities—which by that time would be subsidiary and, perhaps, even marginal?

Mr. Stewart: >: The easiest way to answer the hon. Gentleman's point is to emphasise the new structure, in which there will be a holding company and a successor company. The successor company will take on all the current powers, duties and responsibilities of the authority under statute. It will have exactly the same responsibilities in relation to its port activities as it has currently.

Mrs. Maria Fyfe: rose—

Mr. Stewart: I shall give way to the hon. Lady, but then I hope hon. Members will allow me to continue because I have already given way a number of times.

Mrs. Fyfe: I thank the hon. Gentleman for his courtesy. Will the privatised port authority continue dredging in the River Clyde?

Mr. Stewart: The hon. Lady has raised a good point, which was first raised on Second Reading by the hon. Member for Glasgow, Govan (Mr. Siliars), to whom I always pay attention because I am his constituent. I shall come to the issue of dredging, but if the hon. Lady will forgive me, there is another matter that I wish to raise

first because there has been some publicity about it. The hon. Member for Clydebank and Milngavie is usually the most courteous of hon. Members. I was a little surprised to see the press coverage of his statement when he spoke as a Labour Front-Bench spokesman on employment—

Mr. Worthington: No.

Mr. Stewart: That is what it says in the press release, which has the House of Commons crest on it. I was surprised by his attack on Sir Robert Easton. If the hon. Gentleman was speaking as a Scottish Front-Bench spokesman on employment, I can only presume that that attack on Sir Robert Easton had the full knowledge and support of the hon. Member for Glasgow, Garscadden (Mr. Dewar), the shadow Secretary of State. That also surprised me a little because Sir Robert Easton is the chairman of Yarrow, the largest employer in Garscadden.
I shall quote what is presumably the hon. Member for Garscadden's view of Sir Robert Easton, as expressed by his junior spokesman, the hon. Member for Clydebank and Milngavie. He said:
Why on earth should Sir Robert Easton and his board be able to profit from this sale … Why should they be able to put their hands in the till … Why should they be able to line their own pockets by deciding how many free shares they should have?
Sir Robert Easton has as much chance of free shares as does the hon. Member for Clydebank and Milngavie. The Bill provides that the Clyde port authority, a holding trust, will have the power to transfer securities without consideration—that is, shares with an interest-free loan or whatever—to employees of the holding company or any subsidiary thereof. Under clause 14(4), it is empowered to
provide for one or more employees' share schemes to be established in respect of the holding company; and any such scheme may provide for the transfer of shares without consideration.
Beneficiaries of employee share schemes can be only bona fide employees or former employees. [Interruption.] I am grateful to my hon. and learned Friend the Member for Perth and Kinross (Sir N. Fairbairn), who has kindly handed me a letter informing me of his support for the Bill.

Mr. Wilson: The hon. Gentlemen should not believe a word of it. We know that that piece of paper is the latest set of guarantees on the Law Reform (Miscellaneous Provisions) (Scotland) Bill.

Mr. Stewart: I am happy to assure the House that the guarantee that I have received is that my hon. and learned Friend will be here to vote at the end of the debate.
Sir Robert Easton and the other members of the board, except for the three executive members, are not employees. Therefore, Sir Robert Easton and the non-executive members of the board cannot get shares on any preferential basis except that available generally to residents of the area.

Mr. Worthington: I draw the attention of the hon. Member to clause 8(3), which provides:
Securities required to be issued in pursuance of this section shall be issued or allotted at such time or times and on such terms…as the Trust may direct.
The members of the trust will be Sir Robert Easton and the board of the Clyde port authority. Does that not give them the power to allocate securities to themselves?

Mr. Stewart: Of course it does not. As they are members of the trust, they cannot allocate securities to themselves. If the hon. Gentleman does not believe me, he may believe Mr. Tom O'Connor, the former chairman of the local port workers branch of the Transport and General Workers Union, who has written to the managing director of the Clyde port authority. He will doubtless be well known as a stalwart of the Labour movement in the west of Scotland, although I do not know whether he is still a member of the national executive of the TGWU. The hon. Member for Greenock and Port Glasgow is agreeing with me. I will happily pass copies of this letter to anyone who wishes one. It reads as follows:
I was pleased to have the opportunity of discussing at the Board meeting on Tuesday the articles which appeared last week, in the Scotsman and Evening Times. Both those articles, which I understand were based on a press release issued by Tony Worthington, M.P., contained inaccurate and insulting references to the honesty and integrity of the Members of the Board, and I wish to place on record for posterity my most strenuous objection to these defamatory remarks.
I am glad to have had the opportunity to read that letter.

Mr. Wilson: Did the hon. Gentleman check the typewriter?

Mr. Stewart: It is written in Mr. O'Connor's hand.
The hon. Member for Glasgow, Maryhill (Mrs. Fyfe) asked me, quite fairly, about dredging. This matter has been raised by a number of hon. Members, in Committee and on Second Reading. The Clyde port authority, like every other harbour or port authority in the United Kingdom, has no express statutory duty to dredge the river. The Clyde port authority has power to dredge, as set out in paragraph 16 of the Clyde Port Authority Order 1965, which established the authority. The question is whether the successor company has any authority to dredge the river or whether there would be anything to oblige a successor company to dredge the river if it decided not to do so.

Dr. Godman: I am glad to hear the hon. Gentleman talk about the 1965 order. Paragraph 16 states:
The ports authority may, from time to time, deepen, dredge or scour and improve the bed and foreshore of the river and upper Clyde within the port in or near any approach to the port.
I have today tabled a new clause to the Law Reform (Miscellaneous Provisions) (Scotland) Bill that would make this power statutory. I should like the hon. Gentleman to support the new clause when we debate it in Committee.

Mr. Stewart: The hon. Gentleman will no doubt confirm that members of that Committee do not always disagree. I am grateful for the many worthwhile and penetrating interventions that he made to my speech late on Thursday night, which showed a great deal of knowledge about the annual accounts of charity. However, the hon. Gentleman is leading me down another path. I doubt whether his news about the tabling of a new clause will be received with joy and delight by the Scottish Office, but I hope that there will be time to consider it. I am sure that he would be the first to object if the Government introduced a timetable motion that prevented a full and fair debate of the clause.

Mr. Graham: As the hon. Gentleman knows, I was born in Govan and I have always seen the Clyde as a

working river. The only way to keep it as such is to dredge it regularly so that ships can use it. Everyone, from one end of the Clyde to the other, sees it as the port authority's duty to keep the river open. Once it stopped dredging, the river would silt up and would no longer be navigable. Does not the hon. Gentleman recognise the concern of Labour Members to ensure that the river remains a working river and that dredging is carried out? The Clyde port authority has always been the recognised body to do that.

Mr. Stewart: Yes. I shall now return to the specific point made by the hon. Member for Maryhill. I was diverted for a moment.
I accept that this is a serious argument. I emphasise that the fact that there is no express duty, neither in this Bill nor in any legislation affecting a harbour authority, to dredge is not the same as saying that either the authority or the successor company should stop dredging. The successor company inherits all the powers and duties of the authority. Clause 4(2) says that the successor authority
shall … be treated for all purposes as if it were the same person as the Port Authority.
Therefore, the successor company is in the same position as the port authority.
The authority has a duty, under paragraph 13 of the 1965 order,
to take such steps from time to time as they may consider necessary for the maintenance and improvement of the port and the accommodation and facilities (including navigational facilities) afforded therein or in connection therewith".
Therefore, the authority must carry out those steps with the benefit of the port undertaking in mind. If dredging is necessary to maintain or improve the port, the authority should dredge. Exactly the same principles apply to the future activities of the successor company established under the Bill. Nothing in the legislation imposes on the successor company any less onerous obligations in relation to dredging than those that exist for the present authority.

Mr. Sillars: There is a characteristic difference between the future and the present. At present we are talking about a public undertaking which has implicit obligations to the public good. In future we shall be talking about a private company which, at some later date, may claim that Parliament did not impose a specific obligation. There may have been some residual implied responsibility. I am not splitting hairs or words, but that is entirely different from imposing an obligation.
Given that the hon. Member for Eastwood (Mr. Stewart) is involved in the drafting and the arguments, can he give us an assurance that there is no reason why the promoters of the Bill would resist an amendment in the other place that eliminated all doubt about the future and imposed an obligation as distinct from some residual responsibility which the successor company could claim was not in the Act and did not necessarily have to be carried out?

Mr. Stewart: I shall not speculate on what might or might not happen in another place. I was not claiming that I had been involved in the technical drafting of the Bill. The hon. Member for Govan, who is my Member of Parliament, is quite right to say that I am involved in the argument.

Mr. Redmond: On a point of order, Mr. Deputy Speaker. May I have an assurance from the Chair that the Bill is technically correct and that no technical


amendments will be made? If we pass the Bill, it is important that it is technically correct. If it is technically defective, we should question whether the Clerks have given it sufficient scrutiny.

Mr. Deputy Speaker: The Bill is in order. It would not be before the House if it were not.

Mr. Stewart: May I return to the point raised by the hon. Member for Govan—

Mr. Redmond: Further to that point of order, Mr. Deputy Speaker. I am sorry to delay the hon. Member for Eastwood (Mr. Stewart), but may we take it that all the technical details necessary to make the Bill presentable have been scrutinised and are correct? It may well be that another place will seek to amend the dredging provisions—

Mr. Deputy Speaker: Order. If the Bill were technically defective, it would not be before the House. It is for the House to listen to the debate and make up its mind. It is a matter for the House to decide at 10 o'clock.

Mr. Stewart: Let me return to the point of substance raised by the hon. Member for Govan. Of course I cannot speculate on what might or might not happen in another place.
Essentially I am making two key points. First, the successor company has exactly the same obligations that the Clyde port authority has at present. It has exactly the same powers, duties and responsibilities.

Mr. Graham: Will the hon. Member give way?

Mr. Stewart: First, I shall finish my response to the hon. Member for Govan.
The successor company has exactly the same duties and responsibilities as the Clyde port authority has at present. As I have told the House, to the best of my knowledge, no port authority has an express duty in legislation to dredge a river. The legislation covering the Clyde port authority is in line with legislation that applies elsewhere. The hon. Gentleman will know that some port authorities are trusts and others are in the private sector. Some, such as Bristol, are owned and run by the local authority.

Mrs. Fyfe: Will the hon. Gentleman give way?

Mr. Stewart: I have been generous in giving way, so I fear that this will have to be the last time.

Mrs. Fyfe: Will the hon. Member enlighten the House? He has given repeated assurances that the responsibilities will be exactly the same, but he has the opportunity to write the Bill as he pleases. Why has he decided not to write the Bill in a manner that will ensure that dredging is carried out by imposing a clear duty?

Mr. Stewart: I emphasise that the responsibilities being taken over by the successor company are the same as those held by the Clyde port authority. That seems to be a perfectly reasonable and proper way to proceed.

Mr. Graham: Will the hon. Gentleman give way?

Mr. Stewart: No.
As I have explained to the House, the fact that there is no express duty in legislation does not mean that the authority or the successor company can stop dredging because of the duties that I have outlined to the House.
I have taken up quite a lot of time of the House and a large number of hon. Members wish to speak. Other points have been raised, and I hope that the hon. Member for Clydebank and Milngavie will outline some of the points to which the Clyde port authority responded, for example, on the structure. The Bill was sought by the authority and the board was unanimous. There were no petitions against it, and I understand that the Transport and General Workers Union has not attempted to stop the restructuring proposal in Scotland, although it has taken a different position in regard to Bills applying south of the border.
I hope that the House will feel that I have dealt with some of the major questions that have been raised and will agree to give the Bill a Third Reading tonight.

Mr. Thomas Graham: I should like to point out to the House that recently the Secretary of State for Scotland has decided to give Braehead, a monster project, the go-ahead. That concerns me and the people in my constituency. I represent a huge area of the Clyde, as every Member of Parliament knows. Renfrew district council vigorously opposed the Braehead development, which will destroy the infrastructure of Renfrewshire. It will cause immense problems for the town of Paisley, destroying the new shopping centre which would have been built there. We have recently agreed to the Tilbury operation in Linwood.
You may well ask, Mr. Deputy Speaker, what this has to do with the Bill—

Mr. Deputy Speaker: Order. On Third Reading, the House is required to confine itself to what is in the Bill.

Mr. Graham: I am trying to confine myself to what is in the Bill. The Bill has immense repercussions for my constituency. If the Bill is passed tonight, my constituency will suffer.

Mr. Allan Stewart: Of course the hon. Gentleman is right in the technical sense that the Bill gives the Clyde port authority powers to manage the Braehead development, for example. Will he be a little more explicit as to precisely why he is so opposed to that development? The hon. Gentleman, Renfrew district council and I see eye to eye on many issues.

Mr. Graham: The Bill is amazingly damaging to Scotland, and certainly to Renfrewshire. It will cause incredible problems.
There is much concern among people who live on our side of the river that dredging will not be carried out. The hon. Member for Eastwood (Mr. Stewart) says that if the Bill goes ahead there will be no change, but there must be change. The board will be responsible to shareholders. A commercial decision will be taken not to dredge the River Clyde because it will cost hundreds of thousands of pounds. The authority will say, "We do not have the money so we will not dredge it."
When I was on Strathclyde regional council, we gave Clyde port authority financial help to allow it to dredge the river. The authority will still be responsible for keeping the river clear. It is crazy for it to be privatised. It should remain a public corporation, looking after the interests of the Clyde and of the folk who live on its banks.
Braehead has been given the go-ahead, but it will do so much damage to the Renfrewshire area that it could make ghost towns of communities such as Erskine and Renfrew and it will certainly hammer Paisley shopping centre. That is a genuine concern about what is happening in the Clyde port.
I am sorry that the Secretary of State for Scotland is not here because it appears that there has been a bit of collusion. The other week, the Secretary of State dug a hole at Tilbury and said, "Linwood will rise from the ashes—there will be a big new shopping centre, factories and retail units." The Braehead development, which was refused by the council, got the go-ahead from the Secretary of State. He knows that Renfrewshire cannot take a monstrosity of a project like Braehead. What will happen to the Tilbury site at Linwood? It will end up as only housing, with no works, no factories, no warehouses and no shops. It will become a residential area because of the decision to privatise the Clyde port authority.
When the Secretary of State came to dig a hole in the ground at Tilbury in my constituency he knew that the planned development would not take place because of Braehead. That calls into question any future development in the Linwood area and at Inverclyde. Recently, a decision was taken to go ahead with a shopping centre at Inverclyde. That has a lot to do with what is happening to the Clyde port authority, because anything that it does in the Govan area has a massive impact on Renfrewshire and, in effect, deprives Inverclyde of a genuine development opportunity and makes nonsense of the Inverclyde enterprise zone.
I wish that the Secretary of State was here so that I could challenge him and ask whether he knew that he was going to give planning permission for the Braehead site. Did he tell the Tilbury developers, who are spending vast sums in my area, that he was going to give the go-ahead for the Braehead site? Did he tell the developers in Inverclyde that he was going to give the go-ahead for the Braehead site?
The Bill should be thrown out. It seems that there has been collusion between the Secretary of State and the developers of Braehead and Clyde port. He is fattening up the authority for the kill and for somebody to make a lot of money. At the end of the day, the people of Renfrewshire will suffer. I note that the Minister is smiling—he can smile all he likes, and he may smile to the bank, but our folk have suffered enough from the crazy plans of this Government. This is certainly a crazy plan. It is not a plan to help the people of the Clyde or my constituents—it is a plan to make a wee bit on the side to give to the Government's friends, but they will get a resounding no from the people of Renfrewshire at the next general election. It is another gift for the Government's friends, taking from the ordinary men and women who made the Clyde what it is.

Mr. Bill Walker: The hon. Member for Renfrew, West and Inverclyde (Mr. Graham) spoke with great passion but told us little about how the development of 200 acres at Braehead will affect his

constituents. He seemed to think that those 200 acres, whether they were used for housing or whatever, would not help the local economy.
One of the encouraging aspects of the past few years has been how derelict areas of dockland have been given a new lease of life. Throughout the old major ports of the United Kingdom, buildings that previously had been standing derelict for some years have been brought back into use, establishing living, vibrant and healthy economies. That is what happens when one is able to develop and is free of the shackles of socialism and socialist practices.
As my hon. Friend the Member for Eastwood (Mr. Stewart) said, the Bill received substantial support on Second Reading on 14 May. There were no petitions against it, and none from the riparian local authorities. The hon. Member for Renfrew, West and Inverclyde, who spoke with such passion, realised that the riparian local authorities are controlled by the Labour party. I accept that Cunninghame district council is still obtaining advice on the Bill. Under our democratic system, if it has an interest in the Bill and believes that its benefits are not what it imagines, it will take action. That is the democratic system functioning. Indeed, the Bill is an example of how the democratic system works. It must go through this House and the other place, and there are opportunities for those interested enough to take action.
The reason for the Bill is that the authority, as currently structured and confined by statute, cannot realise its full potential. Its sources of funding and finance are limited and it is unable to enter into joint ventures to develop land that it owns. Borrowing is limited by statute. If it were in the marketplace, borrowing would be restricted by the risk involved, which would be sensible.
It appears that some areas should and could be developed. I do not have enough local knowledge to comment on the proposals and schemes, but anything that brings life back into our docklands and our riversides must be good. If decision making is affected by statutory limitations on the authority, changes should be made. Only if the authority can utilise and manage its resources and assets will it be able to carry out its core area responsibility for the river and marine activities. That is a sensible use of assets in any organisation. The setting up of the holding company, with the successor company assuming all the responsibility and being accountable, means that, in that sense, nothing will change.
I welcome the fact that employees and former employees will be able to obtain shares. Giving people the opportunity to buy shares in the companies in which they work is my idea of spreading the nation's wealth. There is no greater motivator for an employee than the feeling that he owns part of the company in which he works and there is no greater discipline on a board than the knowledge that the employees are shareholders.
I understand that the Opposition are worried about dredging of the river. All United Kingdom rivers are covered by the same legislation, so the Clyde port authority under the successor company will not be in a different position. It is covered by the Clyde Port Authority Order 1965. I look forward to debating—if we ever reach that stage—the new clause tabled by the hon. Member for Greenock and Port Glasgow (Dr. Godman) to the Law Reform (Miscellaneous Provisions) (Scotland) Bill. We could go on for ever with that Bill, but I should step out of line in this debate if I said more. I wish simply


to respond to the hon. Member for Greenock and Port Glasgow. That new clause will affect the responsibilities of the authority or its successor company.
The River Clyde should never be downgraded. It is vital to Scotland's economy and to the welfare of her people. As I said on Second Reading, the Clyde has changed and developed to meet Scotland's needs at each stage—throughout the industrial revolution until today. Who can say what the future holds for that great river and for the successor company that will have the responsibility for management and navigation on the river? Few of us can say where we shall be 10, 20 or 30 years ahead. Who can say what the trade patterns will be?
As everyone knows, handling of imports and exports has changed dramatically and substantially over the past 40 years. Much of the Clyde traffic 40 years ago was handled by port authority workers who carried much of the cargo on their broad shoulders. Today, with containerisation, bulk cargo handling and the shift of trade from north America towards Europe, the Clyde port authority has been faced with substantial changes in work practice, a massive reduction in the labour force and a huge drop in the traffic to and from north America.
The container terminal was constructed, as I said on Second Reading, on the site of Princes pier at Greenock and received its first ship on 15 March 1969. The terminal, with its depth of 42 ft. at low tide, with a back-up area of 42 acres and with rail connections to the major industrial centres of the United Kingdom, had by 1973 attracted 13 shipping lines. Sadly, events overtook the north Atlantic trade and the container terminal ran into difficult times, and it is still experiencing difficulties. At the same time, there has been a substantial change in the old smokestack-related heavy industries throughout Scotland, which led to a major drop in the volume of trade involving the port and the authority. In addition, with the reduction in oil imports—because we have our own oil off the north-east coast—there has been a substantial drop, in the Clyde and other ports, in the trade in imported oil.
The Clyde is in competition with other ports throughout the United Kingdom and Europe, including Leith and Grangemouth in Scotland. Unless the Clyde can change to meet the changes in the marketplace, and unless the port authority has the flexibility and ability to meet the challenges of today and tomorrow, it is clear that it will not be able to compete effectively with other ports in the United Kingdom and Europe.
Like other hon. Members, I am worried about Hunterston, which handles 50 per cent. of the Clyde port authority's traffic, representing 43 per cent. of the authority's revenue. We all know that the well-being and future of Hunterston are very much tied up with the well-being and future of Ravenscraig. We all know that many questions need to be asked and many have not yet been answered. We in Scotland want to know the answers. We shall have opportunities in our different ways to obtain some. Unless we can get some answers, Hunterston's future will have question marks over it. That cannot give any delight to anyone other than those who do not want the Scottish economy to do well. The deep-water port at Hunterston has great facilities that should be maximised.

Mr. Wilson: The hon. Gentleman's point about Hunterston is of interest to all of us and particularly to me from a constituency point of view. Does the hon. Gentleman suggest that anything in the Clyde port

authority's existing powers has contributed over many years, and certainly over the authority's lifetime, to the disappointing underdevelopment of Hunterston?

Mr. Walker: The hon. Gentleman has an edge on me as a constituency Member. If I put a question to him about the well-being of the whisky industry in my constituency, I think that I should have the edge on him. I am not sufficiently knowledgeable to comment on details, and I should not wish to do so.
My concern as a Scottish Member of Parliament is to ensure that Scottish ports can compete effectively, efficiently and on equal terms with other ports throughout the United Kingdom and Europe. The Bill will give the people who run the authority the opportunity to do just that. That is why I have no hesitation in supporting the Bill.

Dr. Norman A. Godman: It is always a pleasure to follow the hon. Member for Tayside, North (Mr. Walker). He has one characteristic in common with members of his Front Bench—he views with distaste awkwardly honest critics on the Labour Benches as much as he views with loathing honestly awkward critics on the Conservative Benches. Many of us have constituency interests and concerns that we wish to defend with the same vigour with which he defends his constituents who work in the whisky industry. The hon. Gentleman should not forget that.
I think that you were fortunate to miss the earlier exchanges, Madam Deputy Speaker—

Madam Deputy Speaker (Miss Betty Boothroyd): Order. I was listening.

Dr. Godman: I meant that it was before you came into the Chamber.

Madam Deputy Speaker: I was listening.

Dr. Godman: I beg your pardon, Madam Deputy Speaker. I certainly do not wish to cross swords with you.
As you are well aware, Madam Deputy Speaker, when Mr. Deputy Speaker was in the Chair we discussed amendments to the Bill which are to be tabled in the other place. I cannot discuss them now because I do not know what they are, but if amendments are made in another place, I shall presumably have the opportunity to scrutinise and discuss them when the Bill comes back. I should like some amendments to be made.
First, I should like clause 4 to be amended so as to require the head office of the Clyde port authority always to be located in Glasgow. The CPA occupies one of the finest buildings in Victorian Glasgow. I have said that to John Mather on a number of occasions, and I believe that he has invited my wife and me to visit the building and examine the architecture.

Mr. Lambie: He will give you lunch.

Dr. Godman: I do not think for one minute that John Mather will give me lunch after what I have to say today, although I may be able to appeal to Sir Robert Easton for a cup of coffee. The head office of the CPA should remain in Glasgow. If it cannot be in Greenock or Port Glasgow, it must be in Glasgow.

Mr. Lambie: My hon. Friend should realise that the main activity of the Clyde port authority is in Cunninghame. Its headquarters should be in Ardrossan and nowhere else.

Dr. Godman: My old and hon. Friend has a point and he has made it in his usual powerful way. But I am trying to be diplomatic. I should like the headquarters to be located in Greenock, but I am perfectly willing to accept that the head office should stay in Robertson street, Glasgow.
I should also like the Bill to be amended to require that the present directors shall not be major shareholders in any successor company.
Clause 4 deals with the duties, liabilities and responsibilities of the authority. The hon. Member for Eastwood (Mr. Stewart) mentioned Inverclyde district council's position on the Bill, so in fairness I ought to say something about that. I would be the last person to impugn the hon. Gentleman's honour or character, but it seems to me that a deal may have been struck with the Secretary of State for Scotland over the passage of the Bill today and the hon. Gentleman's conduct on the Standing Committee considering the Law Reform (Miscellaneous Provisions) (Scotland) Bill.

Mr. Allan Stewart: I can give the hon. Gentleman an absolute assurance that that is not so. I have repeated today that I intend to speak and vote against a guillotine on that Bill if a guillotine motion is introduced.

Dr. Godman: The hon. Gentleman is a man of his word. I readily accept what he has said and withdraw my criticism.
As I said, the hon. Gentleman referred to Inverclyde district council. It is only fair that I should mention the fact that today I received a letter from John Thompson, the director of administration for that council. Mr. Thompson wrote:
The District Council at its meeting yesterday decided not to lodge in the House of Lords a petition objecting to the Bill.
In that regard, the remarks of the hon. Member for Eastwood were accurate. Mr. Thompson continued:
However, the District Council has resolved to seek the support of the Clydeside MPs in opposition to the Bill.
I can well understand why the council is reluctant to petition in the other place. Like most councils in Scotland, it is strapped for cash and the procedure for presenting a petition of objection to an Opposed Private Bill Committee can be an expensive activity.
Mr. Thompson went on to say:
As you know, the District Council opposes the Bill on the grounds that its consequences, if enacted, could potentially be of significant detriment to the District.
My hon. Friend the Member for Renfrew, West and Inverclyde (Mr. Graham) made that point in his inimitable way. Mr. Thompson then said:
In particular, the continuation of the present dredging operations of the River Clyde is extremely important to the economic wellbeing of the whole Clyde area and in particular are of considerable significance to commercial and industrial users of the River. Upon privatisation, it may be the case that a private Company would consider from a commercial view that the dredging operations should be discontinued on the grounds of commercial expediency.
That was what the hon. Member for Glasgow, Govan (Mr. Sillars) suggested in his intervention.
Mr. Thompson went on:

Although at present there is no strict legal obligation imposed on the existing Clyde Port Authority to require the dredging of the River, the Clyde Port Authority does part finance the dredging operations in the wider public interest.
It is right and proper that Mr. Thompson should acknowledge the part played by Clyde port authority at present. His letter continued:
A privatised Company may decide to take a narrower short term commercial view that the dredging operations are not commercially attractive and discontinue these in the future.
Mr. Thompson made some further criticisms. He said, for example:
The Bill would emphasise the property development aspects of the privatised Companies rather than the importance of the Clyde for employment, tourism, commerce and industry, leisure and the environment in general. Such an emphasis on property development may result in short term windfall profits being taken outwith the area of the Clyde without any obligation on the part of the shareholders to re-invest in the local area having regard to any consideration of public interest.
That is what I have said all along about clauses 1 to 5. No matter how estimable Sir Robert Easton and John Mather are—I have respect for both gentlemen and for their officials—a predator company based in London, Dusseldorf, Tokyo or New York may come along and sweep them into the Clyde. Would such people have any commitment to the Clyde and its people? I think perhaps not. That is why I want the Bill amended to require the head office always to be located on the Clyde. My hon. Friend the Member for Cunninghame, South may argue that it should be in Sa1tcoats, but I would settle for Glasgow.

Mr. Sillars: Govan.

Dr. Godman: No. If it is not Glasgow, it has to be Greenock.
Did the hon. Member for Eastwood support the Eurowestport concept put forward by the late John Davidson, formerly director of the CBI in Scotland, who had a vision within which the Clyde port authority had a major role to play? A couple of years ago, in talking about the channel tunnel—I relate my remarks to clauses 4 to 6 of the Bill—he argued the case for Eurowestport:
The Channel Tunnel will be in operation in seven years. The west of Scotland will be then connected, without transshipment break, to the European transport network—a potential advantage we have never enjoyed before. It is that absence of any need for transshipment that alters so dramatically the situation.
The scale of port developments on the European continent has been a major feature of development in the past quarter century. They have established an enviable reputation for economic, uninterrupted service. But it surely ought to be possible to break that mould by detailed forward planning, a positive approach and determined marketing. We must not accept that others have a prescriptive right to the advantages.

Mr. Allan Stewart: The late John Davidson was my successor as director of the Scottish CBI. I thought a great deal about his proposal.

Dr. Godman: I am grateful for the hon. Gentleman's graceful intervention about the late John Davidson.
I quoted the late John Davidson because, with regard to clause 4 of this Bill, in the light of his comments about the Eurowestport concept and the traditional maritime activities carried out on the Clyde, it is essential that the


CPA retains more than just a foothold in those industrial maritime activities. The CPA should not become a property company.
The Minister for Aviation and Shipping is listening to me in his usual attentive way. On Thursday 29 March I asked him to give us the names of the chairman, chief executive and directors of the CPA. One or two of those gentlemen have been mentioned. Needless to say, there are no women on the board. I wonder whether there will be women on future boards.

Mr. Lamble: What about friends of the Under-Secretary of State for Scotland, the hon. Member for Stirling (Mr. Forsyth)?

Dr. Godman: I am not sure whether Tommy O'Connor of the Transport and General Workers Union would want to find himself in such company. In addition to Tommy O'Connor and the then councillor Lawrence McGarry, one of the board members will be the managing director of Scottish Metropolitan Property plc. I wonder what ideas that CPA director has about property developments along the Clyde.
I do not want to speak for much longer because other hon. Members wish to speak. However, I want to consider dredging. It has been readily conceded by John Mather, chief executive of the CPA, by Bob Easton and by others that dredging is a major and vital task. We know that the costs of the dredging are disputed. When the Norwegian company Kvaerner sought to acquire the shipyard in the constituency of the hon. Member for Govan it was unhappy about its responsibility for meeting a share of the dredging costs. Clause 4 (3) refers to the port authority's obligation in relation to the dredging operation.
The other day I saw the dredger in the middle of the river, not far from Lymebank. By any standards she is an ancient vessel, long past her prime, and she needs to be replaced.

Mr. Worthington: That is no way to talk about a lady.

Dr. Godman: I hear what my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington), says and I suspect that the Government Whip, the hon. Member for Derby, North (Mr. Knight), might say the same thing.

Mr. Greg Knight: Do not bring me into it.

Dr. Godman: The dredger is an ancient vessel. She does a fair turn of work, but she needs replacing. I estimate that, to do that job effectively, a new vessel will cost upwards of £12 million. I would like to see such a vessel built on the Clyde.

Mr. Lambie: Well, in Port Glasgow.

Dr. Godman: Where else but at Kvaerner Ferguson of Port Glasgow? The Norwegians are moving in everywhere.
The new company that will be formed if the Bill is enacted will have to find the wherewithal to replace the dredger if the company is to continue the dredging operation. In addition to that capital outlay, over the past two or three years the CPA's annual dredging costs have been in excess of £600,000. In terms of the liability under clause 4, I believe that some assistance is given to the CPA by the Strathclyde regional council, Glasgow district council, Kvaerner of Govan and Yarrow.
While I respect the people who run the CPA's trust board, in terms of clause 4(3) I have tried to change section 16 of the Clyde Port Authority Order Confirmation Act 1965 which reads:
The Port Authority may from time to time deepen, dredge, scour and improve the bed and foreshore of the river and Firth of Clyde".
I have tried to change that power to a duty so that section 16 of the 1965 Act would read:
The Port Authority shall from time to time".
I have sought to do that through a new clause that 1 have tabled to the Law Reform (Miscellaneous Provisions) (Scotland) Bill because I am given to understand that nothing in this Bill abrogates the provisions of the 1965 Act. Does the Minister wish to intervene?

The Minister for Aviation and Shipping (Mr. Patrick McLoughlin): indicated dissent.

Dr. Godman: I thought that the Minister might tell me that I was wrong about that. If I am right, I have every right to table a new clause to a miscellaneous provisions Bill so as to change the 1965 Act. There may be a technicality with which I am not familiar, but I hope that I can change a power to a duty.
The hon. Member for Tayside, North referred to the container terminal. He was right to say that in terms of activity and vessel turn-around the terminal is a shadow of its former self. Nevertheless, there is work there. Ships are coming into the terminal. It is one of our finest deep port facilities—about 42 feet.
If the Bill is successful, the container terminal should continue as a container terminal and the land should not be regarded as a site for executive-style housing in landscaped gardens. Again referring to the late John Davidson's concept of Eurowestport, it is essential to retain that container terminal not only for the people of Greenock and Port Glasgow who work there but for the maritime link to what I hope will one day be a dedicated high-speed link through the channel tunnel and be connected with the European railway network.

Mr. Allan Stewart: The hon. Gentleman is making a fair point. Is he reassured by the fact that the Clyde port authority is investing about £1 million in the terminal for new storage and so on? There will be a real commitment.

Dr. Godman: Yes, indeed. I have seen the facilities. Not long ago, I talked to Phil Cannie and the other ex-dockers who have formed the company which rents the terminal from the CPA. I urged on them a workers' co-operative, but they settled for a private company.
I am concerned that the Clyde port authority will be regarded as a juicy financial morsel by some predator company that has no commitment to Scotland, let alone to the Clyde and the Firth of Clyde.
I am being an awkward customer with this Bill because of my constituency and Clyde-wide interests. In addition to the container terminal, the James Watt dock is in my constituency. Vessels that carry raw cane sugar from the African Caribbean and Pacific cane sugar producing countries are unloaded. There are only two such refineries left in the United Kingdom now—one on the Thames in London and one on the lower Clyde. About 300 of my constituents work in the Tate and Lyle cane sugar refinery. Apart from providing work for constituents, the House of Commons should honour its obligation, under the Lomé sugar protocol, to impoverished countries which produce


that crop. In addition, in my constituency there is a ship repair firm which, I am pleased to say, employs 80 men. Its managing director, Mr. Sinclair, wrote to me the other day after he saw my interview with Miss Margo McDonald on Scottish Television. He expressed his serious concern for the future of the James Watt complex.

Mr. Graham: My hon. Friend will be aware also that constituents who work in the Caledonian MacBrayne shipping company are concerned about what is happening on the Clyde.

Dr. Godman: >: They are indeed. That concern extends along the river and the Firth. Many of those who work around the constituencies of Greenock, Port Glasgow, Inverclyde and Renfrew have some trust in the CPA as it is currently formed, but they are deeply worried about the future ownership of the Clyde port authority and where its head office will be located in 10 years time. If it is to be located in Robertson street in Glasgow and the container terminal is still to receive investment from the Clyde port authority, I shall be a much happier man. However, I have my doubts about the implications for my constituents and many other people and, as one who is directly affected by the Bill, despite the hon. Gentleman's assurances, I shall urge hon. Members to vote against the Bill.

The Minister for Aviation and Shipping (Mr. Patrick McLoughlin): It might be convenient if I said a few words about the Government's position on the Bill. On Second Reading on 14 May I clearly stated the Government's position.

Mr. Wilson: The slight bombshell that the Minister dropped on Second Reading was the fact that the Treasury is to run off with 50 per cent. of the slack and that that would apply to all port privatisations. A report in Lloyd's List last week suggests that, under an amendment to the Finance Bill, the Treasury would not only take 50 per cent. but would then impose a corporation tax of 35 per cent. on the remaining 50 per cent., and that there would then be a further cascading of corporation tax, which could mean that the Government could claw back a still greater proportion of the total revenue. I understand that amendments to the Finance Bill have been reintroduced. As the matter is of substantial significance to any port authority that is thinking of privatising itself, will the Minister clarify the Government's position? If he cannot do so tonight, will he write to me?

Mr. McLoughlin: The position remains as I stated it on Second Reading. As, in the past, the Government put various moneys into trust boards, it is felt right that a proportion should go to the Government. On the hon. Gentleman's specific point, it would be better if I looked again at the report in Lloyd's List and wrote to him with further clarification. That issue will be debated later this evening and when the Finance Bill returns to the House. That may be the best time to clarify the Government's position.
The Bill has come back to the House without any amendments. It has my support, so I hope that it has the support of all hon. Members.

Mr. Jim Sillars: The hon. Member for Eastwood (Mr. Stewart) will correct me if I am wrong about the structure of the new authority and holding company. As I understand it, the successor company will be the functional arm of the holding company carrying out the functions of a port authority. The holding company will be the entrepreneurial, bustling, dynamic business organisation that will capitalise upon assets that are currently held by the Clyde port authority. Hon. Members cannot object to joint ventures between public authorities and private capital to develop ports in Glasgow or in any other part of Scotland. The Scottish Development Agency has engaged in that practice, Glasgow district council has encouraged it, and Strathclyde regional council also encourages it.
However, I fail to understand why we do not have a Bill to extend the powers of the present Clyde port authority to engage in joint ventures with private enterprise partners, and why it is necessary to go all the way to a private shareholding company, which is the holding company. For the life of me I cannot accept that someone has his eye on the massive asset stripping of the Clyde port authority's substantial holdings. The Clyde will by no means be a dead river, and certainly not on the banks where there is considerable development. Some people have great visions of capitalising on the assets on the north and south banks of the river. I share the anxieties of Opposition Members about the preparations that are taking place for massive asset stripping.
I have registered my concern about dredging. I do not think that the hon. Member for Eastwood was trying to mislead us when he said that there was no obligation on the successor company to dredge the Clyde. Clause 4 says that there will be transferred from the present port authority to the successor company
all the property (whether heritable or moveable) of the Port Authority, and to all rights liabilities and obligations of the Port Authority".
What is the obligation if it is not dredging? The explanatory statement from the Bill's promoters suggests that the obligation rests upon the general duty of the port authority, expressed in section 13 of the 1965 Act, to take such steps from time to time as it may consider necessary for the maintenance or improvement of the port and the accommodation and facilities afforded therein or in connection therewith.
The crucial term in that obligation is not "general duty" but "port". What will be the future legal definition of a port? Not long ago such a definition would have been easy on the Clyde because from almost one end to the other it was a series of ports and it could have been said that the whole of the Clyde was a single port. However, that will not necessarily be the case in future because there has been a devastating reduction in commercial and industrial activity on the Clyde. I do not doubt that a container terminal would still be defined as a port and the same definition could be applied to the James Watt dock. But could the definition of a port be applied to the Kvaerner shipyard in Govan? It is a separate undertaking and a private enterprise company. It certainly relies upon the river, but it could not be argued that it relies upon a port.
I am worried about what may happen if we become involved in litigation. Clause 5 makes it ultra vires for the successor company to act beyond not the responsibilities or obligations of the Clyde port authority, but the present


power of that authority. It does not impose any responsibilities or obligations. We are talking about the holding company being transferred to shareholders who are concerned solely with maximising profit irrespective of the effects of any of their policies on the Clyde or its immediate environs in Glasgow or the Greenock area. Some people and organisations would protest if it was decided to stop dredging the Clyde. If the matter went to court, there would be no point in quoting the words in Hansard of the hon. Member for Eastwood because it is a rule of the courts in Scotland and England that Hansard cannot be used as guidance to the meaning of an Act.

Dr. Godman: Some of my constituents genuinely believe that the Clyde port authority does not own waterfront properties in Greenock. They argue their case on the basis of a few contracts signed in 1772 in Edinburgh, which gave to the people of Greenock in perpetuity that area of the waterfront.

Mr. Sillars: I foresee litigation arising and it will make the Court of Session interesting. [Interruption.] If the Bill becomes an Act and a case comes to the Court of Session, the judges will be compelled to interpret the Act. The hon. Member for Eastwood says that he expects the Clyde port authority to continue dredging. He should look again at the explanatory memorandum. It says that the successor company would succeed to the property rights and liabilities of the port authority. Clause 5 is about power only and has nothing to do with rights and liabilities, and it is arguable whether dredging is a legal, contractual liability on the Clyde port authority. If the hon. Gentleman says that it is not an obligation, it lies somewhere in the realm of ambiguity. If a case went to the Court of Session, the judge would say that if Parliament meant the authority to have a specific obligation, it would have written it into the Act. If Parliament does not do that, the matter will be debatable and a judge could well come down against the argument that the authority has a responsibility, a liability and an obligation.

Mr. Allan Stewart: I am following the hon. Gentleman's argument with interest. The duties and powers of the authority are laid down in section 13(3) of the 1965 Act and the successor company takes over those duties and powers.

Mr. Sillars: The authority has the power to dredge the Clyde but, as the hon. Gentleman says, it does not have a legal obligation to do so. If we went to the Court of Session to try to stop the authority dredging the Clyde, it would win the case because it has the power. However, if we went to the Court of Session to make it dredge the Clyde, we should be engaged in an entirely different legal argument.

Mr. Bill Walker: In order to help us follow the hon. Gentleman's line of argument, can he tell us of any other river in the United Kingdom where an authority or a private company has a statutory obligation to dredge the river?

Mr. Sillars: I do not know of any cases that have been tested in the Court of Session and that is what worries me. We have a responsibility to make sure that legislation is absolutely clear and that liabilities and responsibilities are clearly defined in the Act.

Mr. Worthington: All dredging operations in the former inner harbour on the Clyde between Victoria and Glasgow

bridges ceased about a quarter of a century ago. I assume that at some stage that was defined as part of the port, that it is no longer so defined and that if it is possible for the port authority to walk away from the inner harbour, it is possible for it to walk away from anywhere.

Mr. Sillars: I am worried that it is possible for the authority to walk away from the part of the Clyde that serves the important shipyard of Kvaerner and its substantial work force. For the life of me, I cannot understand why those who are arguing for the Bill are not prepared to say that they would advise the promoters, when the Bill goes to the other place, to remove any doubt whatever about the obligations of the successor company.
Having registered my anxiety on that matter, my final point is about the public benefit. I accept that the chairman cannot get free shares and that the hon. Member for Eastwood told us that free shares will be available to the employees. I have never understood the logic of that. I could never understand why, if one happens to be lucky enough to work for the gas board or the Clyde port authority at a certain time, one receives a bonus benefit, whereas if one is unlucky enough because of the labour market not to work for such a company one is denied that benefit. Also someone who worked for such a company but who has left or retired is denied that benefit.
I am worried that the local authorities will not benefit from the privatisation. The local authorities should have what is known in the oil industry as a carried interest, a set number of shares in a company that would become revenue earning. My argument is that if there are developments along the banks of the Clyde both north and south, such as housing and various other developments, the local authorities will be called on to provide a range of services that will add to their financial burden. Therefore, if anyone is to be cut in on free shares, there is a clear case for giving them to local authorities up and down the Clyde. At least in that way they would get something out of the asset stripping of public assets that I fear is inherent in the Bill.
Like the hon. Member for Greenock and Port Glasgow, I hope that there will be amendments in another place to tighten the Bill and produce a better balance in the public interest. That balance in the public interest is missing, so I shall join others in the Lobby in voting against Third Reading.

9 pm

Sir Hector Monro: I shall make only a brief speech.
For the life of me, I cannot understand why the hon. Members for Glasgow, Govan (Mr. Sillars) and for Greenock and Port Glasgow (Dr. Godman) get so worked up about dredging. Of course, dredging is important. That is why the Labour Government in 1969 wrote into the legislation that the Clyde port authority had a duty—I emphasise duty—to take such steps as from time to time
they may consider necessary for the maintenance or improvement of the Port".
One cannot run a port unless from time to time dredging, if it is necessary, is carried out. That duty is carried over from the 1965 legislation into the Bill. Hon. Gentlemen are trying to race a hare that is a non-runner. The powers in the Bill are exactly the same as those in the current legislation. If dredging is required, the authority will have the right to carry it out.
The attitude of Opposition Members is disappointing. They believe that to continue as we are will help the Clyde port authority to run an efficient port. It is obvious that times have changed dramatically since 1965 and the port needs a great deal of support to go into new ventures to maintain its income with which to enhance the port and the community that it represents. One needs only to consider the market decline in trade on the west coast and the move towards the east coast, the restrictive powers in the Act and the way in which heavy engineering has disappeared. The hon. Member for Greenock and Port Glasgow knows better than anyone how things have changed in his constituency and that the Clyde port authority must find new ways of developing the port.
New technology that has come into the west of Scotland does not require the same type of shipping as heavy engineering did years ago. We have also lost the oil shipments from the middle east because of north sea oil, which is welcome. Also imports of grain previously came into the west coast of Scotland from Canada and the United States, not only for whisky distilling but for agriculture. Cereals were imported for feedstuffs. Containerisation has moved to the south and east of the United Kingdom rather than develop on the west coast.
In simple terms, the authority is asking us to give it much greater flexibility to give it the powers to develop the port in the way that it feels necessary. It has had general support from a wide range of people who know what they are talking about. The main opposition to the Bill has come from Opposition Members who seem determined to prevent the port from developing and to drift on into stagnation.

Mr. Sillars: I do not think that the hon. Gentleman has listened to what Opposition Members have said. We recognise the potential benefits of a joint venture and we have argued that it should take place, but why is it necessary to have a wholly privatised Clyde port holding company? Why cannot the present authority have its powers extended so that it can go into a joint venture? What would be wrong with that? That would comply with the development of the Clyde, and we are all in favour of that.

Sir Hector Monro: If obtaining finance and venture capital were as simple as the hon. Gentleman seems to think, no doubt the port authority would have gone down that road. In fact, the authority needs wider powers to deal with what it thinks is the best way forward in developing the Clyde.
I am not sure whether Opposition Members have mentioned responsibilities for lights, buoys and recreation facilities. I am sure that many of us have sailed on the Clyde. In war time, I operated upon it and came to know it reasonably well. There is still a great future for developing recreation on the Clyde, but the port authority needs additional powers. There is the need also to remove any questions of doubt, and that the authority has raised with us from time to time.
The hon. Member for Govan has referred to the narrow issue of venture capital. It would be a pity to lose the opportunity that is presented by a much wider approach to the development of the Clyde because of the opposition of Opposition Members. The port authority has given close

attention to the possibilities and opportunities that are available to it and it will proceed with confidence, provided that the Bill is passed, to develop the Clyde in the best interests of Scotland as a whole but particularly of the west coast and the Firth of Clyde.

Mr. Allan Stewart: Is it not also relevant to the argument that my hon. Friend is advancing that the board of the port authority, which was unanimous in bringing forward the proposals, includes the former councillor, Lawrence McGarry, who was chairman of the economic development committee of Strathclyde regional council?

Sir Hector Monro: That adds force to the support that should be given to the Bill. I understand that the trade unions are enthusiastic that the Bill should proceed.
I have always believed, as does the regional council in my constituency, that economic development committees are constructive and submit positive ideas to enhance the regions in which they operate. That, of course, must take place in conjunction with the Scottish Development Agency, enterprise trusts and the Scottish Industry Department. All these organisations seem keen to go forward together to support the port authority's initiative, and I cannot understand why Opposition Members are so antagonistic to it. We should speak out for Scotland and for the Clyde and give the Bill every encouragement.

Mr. David Lambie: I am grateful for the opportunity to intervene briefly in the debate. I spoke on Second Reading and voted in the Noes Lobby. Since then I have not heard any arguments which have persuaded me to change my mind, so I shall vote against Third Reading.
The hon. Member for Dumfries (Sir H. Monro) is being unfair to Opposition Members, as the hon. Member for Glasgow, Govan (Mr. Sillars) has said. We have been speaking for Scotland in general and for the Clyde in particular. Our only interest in the proposals set out in the Bill is that we consider that the Bill does not speak up, as it were, for Scotland, and especially for the Clyde.
>
The sixth paragraph of the statement issued by the promoters in support of Third Reading states:
The Port Authority would wish their business to have a commercial freedom beyond the severely restricted scope of the present powers of the Port Authority. The aim of the Bill is therefore to free the conduct of the Port Authority's business from the restrictions arising from their present limited powers.
The hon. Member for Eastwood (Mr. Stewart) outlined a series of restrictions and I intervened to remind him that the main function of the port authority was that of a port and harbour authority. He had not given one example of a restriction that affected the port and harbour activities of the port authority. He gave us a lot of restrictions that could be suffered by property and commercial developments if the Clyde port authority constitution is not changed.
In common with other Opposition Members, I realise that things change on a river. Former assets may become liabilities for ports and harbours, but similarly those assets may be attractive as potential property and commercial developments. I appreciate that, given the changes over the years, there must be a restructuring of the Clyde port authority to enable it to sell its assets to realise money to develop its port and harbour facilities. Opposition


Members are afraid that those assets will be stripped by the Clyde port holding company and will be used not for the benefit of the remainder of the Clyde port authority, but for the benefit of that company's directors and shareholders.
I laughed when the hon. Member for Eastwood read the comments made by a colleague and political friend, Tom O'Connor, in support of the Bill. One of the benefits of being here for a long time is that one can remember people and what they did. My political and trade union colleague, Tom O'Connor, was one of the men who prevented the port of Hunterston opening for six months because of a dispute between the Iron and Steel Trades Confederation, the steel workers' union, the Clyde port authority and the Transport and General Workers Union. That man now supports the development of the Clyde when he spent a large part of his life restricting such development. I will not take him as my guide.

Mr. Allan Stewart: I should have thought that that meant that Mr. O'Connor's credentials in the Labour movement were fully established. Would the hon. Gentleman care to enlighten the House on his views of Lawrence McGarry?

Mr. Lambie: I am in enough trouble with Strathclyde regional council, and now with the TGWU, without rising to that bait.
I realise that the Clyde port authority has been subject to restrictions for many years, but the major restriction has been withdrawn by the Government. The major restriction on the port's activities was the national dock labour scheme, which prevented it from developing the Clyde as it should have done. That scheme prevented the authority from developing the concept of a Euro-port, a transshipment port for Europe—as suggested by my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman)—based on the port of Hunterston. The authority is no longer restricted by that scheme and if it was able to realise its assets from sales on the upper Clyde there would be nothing to stop it, even under the present set-up, from developing a major port on the Clyde.

Dr. Godman: Does my hon. Friend agree that the national dock labour scheme was developed to protect registered dock workers from employers who were, in many instances, rapacious?

Mr. Lambie: I accept what my hon. Friend says about the reasons for its establishment, but I am talking about the effects that that scheme had, until last year, on developments on the Clyde.
I accept that there is a need for reorganisation. As we have been told, the Clyde port authority has three constituent parts—the upper Clyde, the lower Clyde, and the firth of Clyde, with the ports of Hunterston and Ardrossan. The port and harbour facilities at upper Clyde are finished. Those are the assets that are to be sold. The upper port is important for its shipbuilding assets, of which the hon. Member for Govan spoke. I may get into trouble with my hon. Friend the Member for Greenock and Port Glasgow by saying that, at the end of the day, maybe even Greenock and Port Glasgow are finished and the full and future development of the Clyde should be in the ports of Hunterston and Ardrossan, especially Hunterston.

Dr. Godman: In Greenock, we have Kvaerner Kincaid, which produces the engines for the vessels built at Kvaerner Govan in the constituency of the hon. Member for Glasgow, Govan (Mr. Sillars). Kincaid employs more than 500 people and Ferguson builds vessels for Caledonian MacBrayne. Greenock and Port Glasgow are far from finished.

Mr. Lambie: I accept what my hon. Friend says, but I am talking about port and harbour facilities. He is talking about manufacturing and shipbuilding facilities, which I hope will continue because a number of my constituents work in those industries.

Mr. Allan Stewart: I am grateful to the hon. Gentleman for giving way. As he knows, I was trying to intervene a few minutes ago, but I did not want to interrupt his flow.
I agree with everything the hon. Gentleman said about the dock labour scheme. My memory may be defective, but I do not recall him voting for the Government measure to abolish it.

Mr. Lambie: Sometimes one has to follow the party Whip. In the end, I voted as I did because of the argument put forward by my hon. Friend the Member for Greenock and Port Glasgow. In the 1940s and 1950s, following the bad history of how the dockers and their families were exploited by the dock owners, there was a need for the scheme, but in the end it became a restriction on the activities of the Clyde port authority.
I am sorry that the Minister spoke so early. I thought that he would have taken the opportunity to speak at the end of the debate to answer the points made in it. If, as have been told, the Government are enforcing a Whip on the Bill, the Minister should have the courage to defend the Bill against the arguments that have come mainly from the Opposition.
Recently, in the Scottish press and media, there have been stories that Sir Robert Scholey—my old friend "Black Bob" Scholey—is interested in building an electric power station at Hunterston to develop it as a major coal port, using the coal to generate electricity in an area earmarked for a new steel mill. I know that it is difficult if it is not in the Minister's brief, but I hope that he will intervene to inform the House whether a Scottish Minister or himself, as Minister with responsibility for ports, has taken part in the plans that we are told have been put forward by British Steel to develop the port of Hunterston, a major part of the Clyde port authority.
In the port of Hunterston there are two direct reduction plants, built by British Steel, which were mothballed the day they were finished. If the Bill is enacted, will it mean that the steel developments for which we are hoping at Hunterston will be stopped because a private company will not be interested in a steel industry for Scotland or that industry's future? Will the Minister inform the House whether the Government are taking part in such negotiations, and can he confirm the statements that have been published in the Scottish press?

Madam Deputy Speaker: Order. I have allowed the hon. Gentleman to range widely, but I must remind him that we are debating Third Reading, which is extremely narrow, and that he can refer only to what is in the Bill at present.

Mr. Lambie: I am trying to do that, Madam Deputy Speaker. I want to know whether the Clyde port authority will be obliged to continue with steel and other


developments at Hunterston when the Bill becomes an Act. My hon. Friend the Member for Cunninghame, North (Mr. Wilson) and I are interested in the future of the ports of Hunterston and Ardrossan, as they are the only real sources of revenue for the Clyde port authority—excluding asset sales.
I hope that the Minister will intervene to inform the House whether, if British Steel intends to build an electricity-generating station at the port of Hunterston, it will be prevented from doing so if that interferes with the steel-making capacity that we hope will be built at Hunterston.
The Bill will be bad for the future of the Clyde and it will be bad for the ports of Hunterston and Ardrossan. That is why I shall vote against Third Reading.

Mr. Tony Worthington: It is unfortunate that the sponsor of the Bill, the hon. Member for Eastwood (Mr. Stewart), did not mention the amendments which it was agreed were necessary to the Bill, and which should have been discussed in Committee. The amendments are not enormously important, but they are significant for the future development of the Bill. The reason why we have not heard about them is that the promoters of the Bill want to avoid a Report stage and to accelerate proceedings on the Bill. That sort of manoeuvre causes a loss of trust.
It was clear from the speech of the hon. Member for Eastwood that the Bill is not necessary in this form. All Opposition Members believe that the port authorities are unsatisfactory at present. There is something questionable about a body when its owners and who it is accountable to are unknown. To say that the port authority needs amending powers is not the same as saying that it needs the Bill.
One of the disappointing aspects of tonight's debate is the fact that no one has considered the structure of the proposed company, and I shall do so later. There is confusion about the Clyde port authority, and it should be cleared up. The authority has been cosy and unexamined since the 1965 order. It is controlled by the CPA board, which is wholly appointed by the Secretary of State for Transport, who claims that he is not responsible for its activities—which I find questionable.
As far as we can tell, the chairman of the board receives £10,000 a year and each of its members £3,500 a year. Appointment to the board involves an important element of trust. The word "trust" keeps cropping up. It is a trust port, and the idea is to have some sort of mandate to safeguard the Clyde on behalf of the people. That means, for example, that the board, quite rightly, is dominated by people who have a central interest in the Clyde. It includes the managing director of Yarrow, the chief executive of Caledonian MacBrayne, a Bank of Scotland representative, a representative of a major property company and representatives from trade unions. Local authorities are represented, but they are not really represented. They are represented in the sense that it would be wrong if their representatives were not on the board, but they are there in a personal capacity, not mandated by the local authorities.
The managing directors of Yarrow and Caledonian MacBrayne would not dream of using their position in that trust port to benefit their companies. It would be unethical to use their position on the board of the Clyde port authority to their personal advantage or to the advantage of their companies. If they were to do so, the whole basis of that trust would break down.
When a new board is established but it keeps the members of the previous board and changes from a trust to a profit-making organisation, we must question the future relationship. It goes back to ownership. In this case, quite clearly the ownership is being transferred to the private sector. The Clyde port authority believes that the Government do not own it, and its chief executive said:
If so, why should it share in the proceeds?
Why should the Government share in the proceeds? That legitimately raises the question, why should anyone share in the proceeds? That must be justified in how the resources of the port authority are shared.
The chief executive said—and I hope that the press is correct:
The board has only God above it.
That is a profound statement that raises serious questions about responsibility and accountability.
All Opposition Members accept that there should be reforms and increased accountability, but there should not be an automatic right of succession to a new company. Those who were appointed to the board of the port authority in trust should not have an automatic right of succession to the new company.
This privatisation is unlike any other. If it were the privatisation of gas, water, electricity or British Steel—which we regret—it would be under the supervision of the Government, who would then market the shares at a certain price. There would be an open door for those shares.

Mr. Sillars: The distinction is that, with the gas privatisation, the new company had to have a memorandum and articles of association that laid down clearly its purposes and objectives. Here we are asked to endorse the setting up of a private company whose memorandum and articles of association, and therefore its purposes and objectives, we know nothing about.

Mr. Worthington: I agree with the hon. Gentleman. It is highly unsatisfactory that we have no details about the successor company when we could be given those details because the people who will decide about the future company are the board members of the Clyde port authority—no one else, because no one else can get in. Three bodies are to be set up—the Clyde port trust, the successor company, and the holding company. The Clyde port trust will extinguish itself. It will be in existence for only a while in order to set up the successor company and the holding company. The Bill says:
The Trust shall consist of a chairman, a deputy chairman, and not less than eight nor more than eleven other members.
These people will be the chairman, deputy chairman and other members of the port authority, who shall become the chairman, deputy chairman and other members of the trust. This body will set up the successor company and will dispose of the securities of the holding company.
The hon. Member for Eastwood challenged me about my statement that the employee share ownership scheme applied only to the non-executive directors of the port authority. I was drawing his attention to another clause,


which allows the securities to be distributed as the port trust wishes. Who has ever heard of a company in which the workers got shares but the directors did not? That would be a first. I am willing to withdraw all that I have said on this issue if the hon. Member will assure me that none of the non-executive directors, who are appointed by the Secretary of State for Transport, will benefit from privatisation.

Mr. Allan Stewart: If the general public are allowed to take up shares in the new holding company, then the directors, or the hon. Gentleman, or I, or anybody else, could apply for shares. The point is that the interest-free loan for shares is limited solely to employees or past employees of the company, so that that includes the executive directors, who are employees, but not the non-executive directors.

Mr. Worthington: That was not the assurance that I was seeking, but it takes me on to another point. The hon. Member is implying that shares in this company will be issued on the basis of a public issue of shares. We know nothing about this. He said that it would be open to me, on my humble income, to apply for shares alongside all other members of the public and to be allocated shares. Will there be a public issue of shares or will shares be issued by invitation?

Mr. Allan Stewart: That is a possibility. The board made it quite clear that it wanted to place shares with Scottish financial institutions. That is its preference.

Mr. Worthington: That is why we should be examining the Bill. Apart from a press release which was produced in about November containing a stated wish that the shares should be placed with Scottish financial institutions, I was not aware that there had been any commitment about who would get the shares or in what form. No details whatsoever have been issued about how the company is to be launched, but it is now quite clear that it will not be a public issue of shares with a listing on the Stock Exchange. There has been no attempt at that, but in some mystical way the company will be launched and people will be given the opportunity to have shares.

Dr. Godman: With regard to the non-executive directors of the present board, let me point out to my hon. Friend that there is no representative from Strathclyde regional council.

Mr. Worthington: That is correct. There never was a representative of Strathclyde regional council in a formal sense; there was a person who also happened to be a councillor on Strathclyde regional council.

Dr. Godman: Is it not the case that, when the Secretary of State makes appointments to quangos, nominations are requested from the Scottish Trades Union Congress, for example, and the local councils?

Mr. Worthington: No doubt the Department of Transport constructs such boards in a way similar to the way in which the Scottish Office constructs the boards for quangos under its control. However, I want to stick with my principal point.
If we give the Bill a Third Reading today, we shall be giving a blank cheque to a number of nominees of the Secretary of State for Transport to set up the successor company in whatever form they want. It may or may not

benefit them, but it will not have to be in a detailed form approved by the House. We have an extremely vague Bill. We could have been given much more detail because the people who will shape the Clyde board trust, the holding company and the successor company are all in post in the Clyde port authority. Only they will be able to determine the shape of the new company.
The Bill is of considerable importance to the west of Scotland. The Opposition are disappointed that there has been so little interest in an issue of such importance to the future of the Clyde area. The Clyde has considerable symbolism. The port has economic, leisure and general social importance to the health of the area. Those who are in control of the Clyde must be checked to ensure that their interest in the Clyde and the people of the west of Scotland is central. If we give the Bill a Third Reading tonight, there will be no restrictions on who may own the companies and develop them in future.
There has been much reference to dredging. Through the process of debate we have clarified that issue. We now have a different answer from the first answer we received from the hon. Member for Eastwood. When the hon. Member for Glasgow, Govan (Mr. Sillars) asked him whether the successor company would be responsible for dredging the river, the hon. Member for Eastwood replied that that was a fair question and that the answer was yes. The answer is not yes; the answer is maybe. The existing legislation allows the port authority to withdraw from dredging, and it will allow the future company to do so. Labour Members are concerned that because the authority will be privatised a commercial judgment will be made about whether it is profitable to dredge the Clyde. There are far more profitable activities for the successor company than to dredge the Clyde; that is a cost, not a profit-making exercise.
The regional council, the port authority and others commissioned studies which showed that the withdrawal of dredging would have consequences such as flooding and restricting access up the Clyde. An article on the consequences of global warming for the Clyde appeared in Scotland on Sunday on 10 June. There are many low-lying areas—Langhank on one side and Bowling on the other, which has the holding tanks for oil—where the consequences of flooding would be considerable.
A major port, its drainage, sewage and general environment, is much better controlled by a body that has as its central interest the welfare of the people of the area rather than by a private company, just for the time being and only if it is profitable. That is why I shall oppose the Bill.

Mr. Brian Wilson: To a large extent, today's debate has been a re-run of the Second Reading debate, without much more light being shed, certainly by the sponsor of the Bill.
We have had one or two additions. We were pleased to see the occasional presence of the Secretary of State for Scotland, anxiously surveying his disparate little flock like the good shepherd to ensure that they are in good working order and all present and correct. We heard the same speech in three different forms from Scottish Conservative Members, which is possibly better than having no speech from the Minister.
To a large extent, we are being asked to accept the Bill without the case being spelt out meaningfully by the Government, who later will whip in sufficient Members to see the Bill over this hurdle.
It is important to spell out, as my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington) has been doing so eloquently and on the basis of much research and knowledge, the fact that we are not considering a trivial measure or some matter peripheral to the Scottish economy. We are debating a Bill which will convert a public body which is a trust—a word that should have a rather special meaning—in name if not in nature, with assets worth £53 million, into a private company. In any other age, and under any other Government, that would be a remarkable piece of effrontery and a remarkable achievement for those involved in converting into private property assets that they have certainly not created or earned. That is what is being done, and outside the House there are names for such practices.

Mr. Allan Stewart: Does the hon. Gentleman associate himself 100 per cent. with the remarks in the press release of the hon. Member for Clydebank and Milngavie (Mr. Worthington), to which I referred earlier?

Mr. Wilson: I am capable of making my own remarks.
One of the most remarkable aspects of the debate has been the unlikely sanctification by the hon. Member for Eastwood (Mr. Stewart) of Mr. Tom O'Connor and Mr. Lawrence McGarry—gentlemen whom I have not in the past heard the hon. Gentleman speak of in terms of admiration. In opening his speech, the hon. Gentleman said that he did not want to repeat at length the arguments made on Second Reading. That would have been difficult, as he did not make them at length then. I suppose that the only relief today was that he did not quote Harry Lauder to flesh out his remarks as he did on Second Reading.

Mr. Stewart: rose—

Mr. Wilson: The hon. Gentleman may wish to remedy that now, but I do not have time for such diversions.
Questions are unanswered. Why is the Bill needed? Why do we need a private company? If there are powers which are not at present beyond the reach of the Clyde port authority, why cannot those powers be obtained through legislation while maintaining the existing framework? By legislating in this way, we do not create a pot of gold or a private company out of public assets. That is why the Bill is being pursued.
I welcome the relatively benign presence of the Secretary of State for Scotland. Another curiosity that I have noticed in the past few minutes has been the hon. Member for Brigg and Cleethorpes (Mr. Brown) flitting around the Chamber, advising all whose ear he can catch about how to proceed in the closing stages of the debate. That is exactly the kind of grubby measure in which one would expect the hon. Gentleman to be actively involved. It is certainly not the wellbeing of Clydeside communities that has motivated him to be with us at this hour.
All the examples quoted by the hon. Member for Eastwood in terms of the alleged need for the extended powers of the newly privatised company relate to speculative development—not the functions of a river authority. Labour Members accept that there are

occasions when development should take place and when partnership between the public and the private sector is desirable, but we certainly do not accept that it is beyond the wit of the existing authority to enter into such relationships to achieve specific ends. We do not believe, however, that it is self-evidently true that a harbour authority should take unto itself powers which put it, as a private company, in a position of what might be regarded as unreasonable strength, with the advantage over all other developments.
The example quoted by my hon. Friend the Member for Renfrew, West and Inverclyde (Mr. Graham) is relevant. We have public bodies and private developers advancing supermarket and commercial development schemes in Renfrewshire—exactly the kind of developments to which the hon. Member for Eastwood referred. The Clyde port authority, because of its advantageous position as a holder of the riverside sites, will cut across everything else being done. By gaining access to these sites as a public body, it will take unto itself power to override the wider planning considerations of Renfrewshire. I can well understand the fury with which that proposal has been received by local authorities—which, presumably, the hon. Member for Eastwood would regard as wicked, anachronistic institutions—and by private sector developments which are intensively involved in these developments. The Clyde port authority has ridden roughshod over them in the deal that has been struck with the Scottish Office over the Braehead development.

Mr. Allan Stewart: The hon. Gentleman should withdraw that comment. I specifically said that Renfrew district council, which is controlled by the Labour party, the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) and I see eye to eye.

Mr. Wilson: In his guise as a reasonable man—I am familiar with that guise and have been known to value it at times—the hon. Gentleman has repeatedly said how often he finds himself agreeing with Renfrew district council and, by association, what a fine bunch of chaps they are. What he has not told us is why, on this specific issue, he finds himself in direct conflict with Renfrew district council and why he is sponsoring a Bill which runs directly contrary to the interests and wishes of that council. I do not see the hon. Gentleman rushing to intervene at this stage.

Mr. Stewart: The hon. Gentleman alleged that I was making a blanket condemnation of Renfrew district council. That is simply not the case. Of course there are issues on which I disagree with Renfrew district council—but not all the time.

Mr. Wilson: No, but this is such an issue, and we note that the grounds for the disagreement have not been explained.
Inverclyde district council said in its letter to Opposition Members:
The Bill would emphasise the property development aspects of the privatised Companies rather than the importance of the Clyde for employment, tourism, commerce and industry, leisure and the environment in general. Such an emphasis on property development may result in short term windfall profits being taken outwith the area of the Clyde without any obligation on the part of the shareholders to re-invest in the local area having regard to any consideration of public interest.


That, in a nutshell, is one of our objections to the Bill: the Clyde port authority will become primarily and overwhelmingly a property development company, to the exclusion—certainly the subordination—of marine interests.

Mr. Graham: My hon. Friend is aware that it took us years and years to make plans for the old factory site at Linwood, where we had lost 9,000 jobs. We were going to build warehouses, factories, retail outlets. Along came Tilbury, and now the plans are in jeopardy as a result of the present scheme.

Mr. Wilson: I well understand the strength of feeling that my hon. Friend expressed, and we note the failure of the hon. Member for Eastwood to reconcile such feelings with his support for the Bill, which will precipitate the Braehead development and others like it.
On dredging, the point has been made well and often that there is a difference between powers and duties. Everyone knows that. Everyone knows that the Clyde port authority has a power to dredge. It exercises that power—indeed, it regards it as a duty. That is what it is in business for. Equally, everyone knows that if we do not write a duty into the constitution of the private authority—which, as I have explained, will have a different role and a different order of priorities, although perhaps not in the immediate future—the power will not necessarily be acted upon. Our concerns on this subject have been added to rather than diminished by the conspicuous refusal of the hon. Member for Eastwood to give any assurances on the matter. All that the hon. Gentleman has incanted and all that the hon. Members for Tayside, North (Mr. Walker) and for Dumfries (Sir H. Monro) have said is that the powers will not change. We all know that the powers will not change, but that means that no duty will be imposed on the new company to carry out dredging.
I share precisely the view expressed by my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) about the industrial relic that now floats about dredging the Clyde. It is not unreasonable to estimate that £10 million or £12 million worth of capital will be required to renew the vessel which dredges the Clyde. We have heard nothing from the hon. Member for Eastwood about where that capital is to come from when the time comes, as it presumably soon will, to replace the dredging vessel.
We know that, at some future time, the privatised Clyde port authority will say, "There is no duty upon us to dredge the Clyde and it is not economic to do so." The bill will then land up with the local authorities and if the local authorities do not pick up the tab, the Clyde will no longer be dredged, although dredging is vital to its role as a marine thoroughfare. We know that Kvaerner has balked at the contribution that it is asked to make to meet the dredging costs. What will happen if that company refuses to contribute its part of the dredging costs? Is Yarrow's—perhaps by then no longer under Sir Robert Easton—to continue to contribute to the dredging costs? If not, who will pay to dredge the Clyde? That such questions have gone unanswered by the hon. Member for Eastwood is, to say the least, disappointing.
I met an old friend of mine recently, Mr. Finlay McNeil, a distinguished piper and Gaelic singer, who had childhood memories of the area. He was a member of what might be known as the Gaelic diaspora in Greenock. His father served on vessels which had the duty to maintain the

lighthouses on the Clyde. He happened to tell me that that function now belongs to the CPA. Is that a power or a duty? What undertakings can the hon. Member for Eastwood give us that the CPA will continue to maintain the lighthouses on the Clyde? If that function is not fulfilled by the CPA, who will fulfil it? I should be pleased if the hon. Member for Eastwood would intervene and reassure me on that point.
The financing of the CPA is, to say the least, dodgy. It is only a few weeks since we heard of the distress in the ranks of the CPA about the prospect of the closure of Ravenscraig. We shall all resist that closure, but if it happens, it will have a drastic effect on the finances of the CPA. Some 50 per cent. of the CPA's profits come from its Hunterston's operations. The Opposition will fight to ensure that Ravenscraig survives, but if through the carelessness of the Government that plant does not survive, what will be the impact on the overall finances of the CPA?
Earlier, I asked the Minister what would happen to a privatised CPA if a report in Lloyd's List is correct and it will not be 50 per cent. of the takings that is seized by the Treasury but corporation tax on that amount, which could mean 65 per cent. or more of the revenue from the privatisation of the CPA being taken by the Treasury. What would happen if the CPA does not, as envisaged, have a healthy capital position at the outset and guaranteed revenue from the activities at Hunterston? What if the CPA loses much of the capital and much of the revenue? None of those questions has been answered. Even more disgracefully, no attempt has been made by the Bill's sponsors to answer them.
It has been the responsibility of Labour Members to lead public opinion on this issue. Over several months my colleagues and I have tried to interest public opinion in Scotland about this matter. We have repeatedly drawn attention to the possible implications for the CPA. I would not be anything other than honest if I did not say that I am disappointed by the response.
We are somewhat inured to such measures if we can allow a public trust with assets of £53 million to be converted into private property without more of a reaction than there has been in Scotland in recent months. I am disappointed that there has been no reaction from Strathclyde region, which is the major local authority with statutory powers involved in the CPA. Many of the district councils have the gravest reservations about the proposal, but in the absence of a lead from the major local authority, they do not feel that they can take a stand on their own, although many have expressed reservations.
It is inexplicable that, while the Transport and General Workers Union opposed the Teesside legislation vigorously, it has taken no such stance over the Clyde—

Mr. Allan Stewart: rose in his place and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 178, Noes 47.

Division No. 274]
[9.58 pm


AYES


Aitken, Jonathan
Atkins, Robert


Alexander, Richard
Baker, Nicholas (Dorset N)


Allason, Rupert
Batiste, Spencer


Amess, David
Beaumont-Dark, Anthony


Arbuthnot, James
Beith, A. J.


Arnold, Jacques (Gravesham)
Bellingham, Henry






Bendall, Vivian
Kirkwood, Archy


Bennett, Nicholas (Pembroke)
Knapman, Roger


Benyon, W.
Knowles, Michael


Blaker, Rt Hon Sir Peter
Lawrence, Ivan


Boscawen, Hon Robert
Lennox-Boyd, Hon Mark


Boswell, Tim
Lester, Jim (Broxtowe)


Bowden, Gerald (Dulwich)
Lightbown, David


Bowis, John
Lilley, Peter


Braine, Rt Hon Sir Bernard
Lloyd, Peter (Fareham)


Brandon-Bravo, Martin
Lord, Michael


Brazier, Julian
Lyell, Rt Hon Sir Nicholas


Bright, Graham
Macfarlane, Sir Neil


Brown, Michael (Brigg &amp; Cl't's)
MacGregor, Rt Hon John


Browne, John (Winchester)
MacKay, Andrew (E Berkshire)


Buck, Sir Antony
Maclean, David


Budgen, Nicholas
McLoughlin, Patrick


Butterfill, John
Malins, Humfrey


Campbell, Menzies (Fife NE)
Marshall, John (Hendon S)


Carlisle, Kenneth (Lincoln)
Marshall, Sir Michael (Arundel)


Carrington, Matthew
Martin, David (Portsmouth S)


Chalker, Rt Hon Mrs Lynda
Maxwell-Hyslop, Robin


Chapman, Sydney
Mayhew, Rt Hon Sir Patrick


Chope, Christopher
Miller, Sir Hal


Clark, Dr Michael (Rochford)
Mitchell, Andrew (Gedling)


Clark, Sir W. (Croydon S)
Mitchell, Sir David


Colvin, Michael
Moate, Roger


Coombs, Anthony (Wyre F'rest)
Molyneaux, Rt Hon James


Coombs, Simon (Swindon)
Monro, Sir Hector


Cran, James
Montgomery, Sir Fergus


Currie, Mrs Edwina
Morris, M (N'hampton S)


Davies, Q. (Stamf'd &amp; Spald'g)
Moss, Malcolm


Davis, David (Boothferry)
Mudd, David


Day, Stephen
Neale, Gerrard


Douglas-Hamilton, Lord James
Neubert, Michael


Dunn, Bob
Nicholson, David (Taunton)


Durant, Tony
Norris, Steve


Fairbairn, Sir Nicholas
Onslow, Rt Hon Cranley


Fallon, Michael
Oppenheim, Phillip


Field, Barry (Isle of Wight)
Paice, James


Fishburn, John Dudley
Patnick, Irvine


Fookes, Dame Janet
Patten, Rt Hon Chris (Bath)


Forsyth, Michael (Stirling)
Pattie, Rt Hon Sir Geoffrey


Forth, Eric
Pawsey, James


Fox, Sir Marcus
Porter, David (Waveney)


Franks, Cecil
Price, Sir David


Freeman, Roger
Raison, Rt Hon Timothy


Fry, Peter
Redwood, John


Gale, Roger
Renton, Rt Hon Tim


Garel-Jones, Tristan
Rhodes James, Robert


Gill, Christopher
Riddick, Graham


Glyn, Dr Sir Alan
Ridsdale, Sir Julian


Goodlad, Alastair
Rifkind, Rt Hon Malcolm


Goodson-Wickes, Dr Charles
Rowe, Andrew


Gorman, Mrs Teresa
Shaw, Sir Giles (Pudsey)


Gow, Ian
Shaw, Sir Michael (Scarb')


Greenway, Harry (Ealing N)
Shephard, Mrs G. (Norfolk SW)


Greenway, John (Ryedale)
Shepherd, Colin (Hereford)


Griffiths, Peter (Portsmouth N)
Sims, Roger


Ground, Patrick
Skeet, Sir Trevor


Grylls, Michael
Smith, Sir Dudley (Warwick)


Hamilton, Neil (Tatton)
Smith, Tim (Beaconsfield)


Hanley, Jeremy
Squire, Robin


Hargreaves, A. (B'ham H'll Gr')
Stanbrook, Ivor


Harris, David
Stanley, Rt Hon Sir John


Hayes, Jerry
Stern, Michael


Hayhoe, Rt Hon Sir Barney
Stevens, Lewis


Hind, Kenneth
Stewart, Allan (Eastwood)


Hogg, Hon Douglas (Gr'th'm)
Stewart, Andy (Sherwood)


Howard, Rt Hon Michael
Stewart, Rt Hon Ian (Herts N)


Howarth, G. (Cannock &amp; B'wd)
Stradling Thomas, Sir John


Howe, Rt Hon Sir Geoffrey
Summerson, Hugo


Howell, Ralph (North Norfolk)
Taylor, John M (Solihull)


Hughes, Robert G. (Harrow W)
Thompson, D. (Calder Valley)


Irvine, Michael
Thompson, Patrick (Norwich N)


Jack, Michael
Thorne, Neil


Janman, Tim
Waddington, Rt Hon David


Johnson Smith, Sir Geoffrey
Walker, Bill (T'side North)


Key, Robert
Wallace, James


King, Roger (B'ham N'thfield)
Waller, Gary


Kirkhope, Timothy
Watts, John





Wells, Bowen
Wood, Timothy


Widdecombe, Ann



Winterton, Mrs Ann
Tellers for the Ayes:


Winterton, Nicholas
Mr. Tim Devlin and


Wolfson, Mark
Mr. William Hague.

Question accordingly agreed to.

Question put accordingly, That the Bill be now read the Third time:—

The House proceeded to a Division—

Mrs. Fyfe: (seated and covered): On a point of order, Madam Deputy Speaker. I wish to say—

Madam Deputy Speaker: Order. I shall take the point of order after the Division.

Mrs. Fyfe: On a point of order, Madam Deputy Speaker.

Madam Deputy Speaker: Order. The hon. Lady would do herself a great justice—[Interruption.] Order. I am trying to speak. The hon. Lady will do herself justice if she waits until the Division is over so that I can hear her properly and the entire House can hear her.

Mrs. Fyfe: I accept that, Madam Deputy Speaker. Thank you.

The House having divided: Ayes 173, Noes 43.

Division No. 274]
[9.58 pm


AYES


Aitken, Jonathan
Atkins, Robert


Alexander, Richard
Baker, Nicholas (Dorset N)


Allason, Rupert
Batiste, Spencer


Amess, David
Beaumont-Dark, Anthony


Arbuthnot, James
Beith, A. J.


Arnold, Jacques (Gravesham)
Bellingham, Henry






Bendall, Vivian
Kirkwood, Archy


Bennett, Nicholas (Pembroke)
Knapman, Roger


Benyon, W.
Knowles, Michael


Blaker, Rt Hon Sir Peter
Lawrence, Ivan


Boscawen, Hon Robert
Lennox-Boyd, Hon Mark


Boswell, Tim
Lester, Jim (Broxtowe)


Bowden, Gerald (Dulwich)
Lightbown, David


Bowis, John
Lilley, Peter


Braine, Rt Hon Sir Bernard
Lloyd, Peter (Fareham)


Brandon-Bravo, Martin
Lord, Michael


Brazier, Julian
Lyell, Rt Hon Sir Nicholas


Bright, Graham
Macfarlane, Sir Neil


Brown, Michael (Brigg &amp; Cl't's)
MacGregor, Rt Hon John


Browne, John (Winchester)
MacKay, Andrew (E Berkshire)


Buck, Sir Antony
Maclean, David


Budgen, Nicholas
McLoughlin, Patrick


Butterfill, John
Malins, Humfrey


Campbell, Menzies (Fife NE)
Marshall, John (Hendon S)


Carlisle, Kenneth (Lincoln)
Marshall, Sir Michael (Arundel)


Carrington, Matthew
Martin, David (Portsmouth S)


Chalker, Rt Hon Mrs Lynda
Maxwell-Hyslop, Robin


Chapman, Sydney
Mayhew, Rt Hon Sir Patrick


Chope, Christopher
Miller, Sir Hal


Clark, Dr Michael (Rochford)
Mitchell, Andrew (Gedling)


Clark, Sir W. (Croydon S)
Mitchell, Sir David


Colvin, Michael
Moate, Roger


Coombs, Anthony (Wyre F'rest)
Molyneaux, Rt Hon James


Coombs, Simon (Swindon)
Monro, Sir Hector


Cran, James
Montgomery, Sir Fergus


Currie, Mrs Edwina
Morris, M (N'hampton S)


Davies, Q. (Stamf'd &amp; Spald'g)
Moss, Malcolm


Davis, David (Boothferry)
Mudd, David


Day, Stephen
Neale, Gerrard


Douglas-Hamilton, Lord James
Neubert, Michael


Dunn, Bob
Nicholson, David (Taunton)


Durant, Tony
Norris, Steve


Fairbairn, Sir Nicholas
Onslow, Rt Hon Cranley


Fallon, Michael
Oppenheim, Phillip


Field, Barry (Isle of Wight)
Paice, James


Fishburn, John Dudley
Patnick, Irvine


Fookes, Dame Janet
Patten, Rt Hon Chris (Bath)


Forsyth, Michael (Stirling)
Pattie, Rt Hon Sir Geoffrey


Forth, Eric
Pawsey, James


Fox, Sir Marcus
Porter, David (Waveney)


Franks, Cecil
Price, Sir David


Freeman, Roger
Raison, Rt Hon Timothy


Fry, Peter
Redwood, John


Gale, Roger
Renton, Rt Hon Tim


Garel-Jones, Tristan
Rhodes James, Robert


Gill, Christopher
Riddick, Graham


Glyn, Dr Sir Alan
Ridsdale, Sir Julian


Goodlad, Alastair
Rifkind, Rt Hon Malcolm


Goodson-Wickes, Dr Charles
Rowe, Andrew


Gorman, Mrs Teresa
Shaw, Sir Giles (Pudsey)


Gow, Ian
Shaw, Sir Michael (Scarb')


Greenway, Harry (Ealing N)
Shephard, Mrs G. (Norfolk SW)


Greenway, John (Ryedale)
Shepherd, Colin (Hereford)


Griffiths, Peter (Portsmouth N)
Sims, Roger


Ground, Patrick
Skeet, Sir Trevor


Grylls, Michael
Smith, Sir Dudley (Warwick)


Hamilton, Neil (Tatton)
Smith, Tim (Beaconsfield)


Hanley, Jeremy
Squire, Robin


Hargreaves, A. (B'ham H'll Gr')
Stanbrook, Ivor


Harris, David
Stanley, Rt Hon Sir John


Hayes, Jerry
Stern, Michael


Hayhoe, Rt Hon Sir Barney
Stevens, Lewis


Hind, Kenneth
Stewart, Allan (Eastwood)


Hogg, Hon Douglas (Gr'th'm)
Stewart, Andy (Sherwood)


Howard, Rt Hon Michael
Stewart, Rt Hon Ian (Herts N)


Howarth, G. (Cannock &amp; B'wd)
Stradling Thomas, Sir John


Howe, Rt Hon Sir Geoffrey
Summerson, Hugo


Howell, Ralph (North Norfolk)
Taylor, John M (Solihull)


Hughes, Robert G. (Harrow W)
Thompson, D. (Calder Valley)


Irvine, Michael
Thompson, Patrick (Norwich N)


Jack, Michael
Thorne, Neil


Janman, Tim
Waddington, Rt Hon David


Johnson Smith, Sir Geoffrey
Walker, Bill (T'side North)


Key, Robert
Wallace, James


King, Roger (B'ham N'thfield)
Waller, Gary


Kirkhope, Timothy
Watts, John





Wells, Bowen
Wood, Timothy


Widdecombe, Ann



Winterton, Mrs Ann
Tellers for the Ayes:


Winterton, Nicholas
Mr. Tim Devlin and


Wolfson, Mark
Mr. William Hague.




NOES


Armstrong, Hilary
Lambie, David


Barnes, Harry (Derbyshire NE)
Leadbitter, Ted


Beckett, Margaret
Lofthouse, Geoffrey


Bell, Stuart
McAllion, John


Bermingham, Gerald
McCartney, Ian


Brown, Nicholas (Newcastle E)
McFall, John


Buckley, George J.
McKelvey, William


Carr, Michael
Mahon, Mrs Alice


Clarke, Tom (Monklands W)
Michael, Alun


Clelland, David
Michie, Bill (Sheffield Heeley)


Cohen, Harry
Nellist, Dave


Crowther, Stan
Powell, Ray (Ogmore)


Cryer, Bob
Redmond, Martin


Davis, Terry (B'ham Hodge H'l)
Sillars, Jim


Dixon, Don
Skinner, Dennis


Dunnachie, Jimmy
Spearing, Nigel


Eadie, Alexander
Strang, Gavin


Evans, John (St Helens N)
Wareing, Robert N.


Ewing, Harry (Falkirk E)
Welsh, Andrew (Angus E)


Flynn, Paul
Wilson, Brian


Foster, Derek
Worthington, Tony


Godman, Dr Norman A.



Graham, Thomas
Tellers for the Noes:


Griffiths, Nigel (Edinburgh S)
Mr. Mike Watson, and


Haynes, Frank
Mr. Maria Fyfe.


Ingram, Adam

Division No. 275]
[10.09 pm


AYES


Aitken, Jonathan
Bowis, John


Alexander, Richard
Braine, Rt Hon Sir Bernard


Allason, Rupert
Brandon-Bravo, Martin


Amess, David
Brazier, Julian


Arbuthnot, James
Bright, Graham


Arnold, Jacques (Gravesham)
Brown, Michael (Brigg &amp; Cl't's)


Atkins, Robert
Browne, John (Winchester)


Baker, Nicholas (Dorset N)
Buck, Sir Antony


Batiste, Spencer
Budgen, Nicholas


Beaumont-Dark, Anthony
Butterfill, John


Beith, A. J.
Campbell, Menzies (Fife NE)


Bellingham, Henry
Carlisle, Kenneth (Lincoln)


Bendall, Vivian
Carrington, Matthew


Bennett, Nicholas (Pembroke)
Chalker, Rt Hon Mrs Lynda


Benyon, W.
Chapman, Sydney


Blaker, Rt Hon Sir Peter
Chope, Christopher


Boscawen, Hon Robert
Clark, Dr Michael (Rochford)


Boswell, Tim
Clark, Sir W. (Croydon S)


Bowden, Gerald (Dulwich)
Colvin, Michael






Coombs, Anthony (Wyre F'rest)
McLoughlin, Patrick


Coombs, Simon (Swindon)
Malins, Humfrey


Cran, James
Marshall, John (Hendon S)


Currie, Mrs Edwina
Marshall, Sir Michael (Arundel)


Davies, Q. (Stamf'd &amp; Spald'g)
Martin, David (Portsmouth S)


Davis, David (Boothferry)
Maxwell-Hyslop, Robin


Day, Stephen
Mayhew, Rt Hon Sir Patrick


Douglas-Hamilton, Lord James
Miller, Sir Hal


Dunn, Bob
Mitchell, Andrew (Gedling)


Durant, Tony
Mitchell, Sir David


Fairbairn, Sir Nicholas
Moate, Roger


Fallon, Michael
Monro, Sir Hector


Field, Barry (Isle of Wight)
Montgomery, Sir Fergus


Fishburn, John Dudley
Morris, M (N'hampton S)


Fookes, Dame Janet
Moss, Malcolm


Forsyth, Michael (Stirling)
Neale, Gerrard


Forth, Eric
Neubert, Michael


Fox, Sir Marcus
Nicholson, David (Taunton)


Franks, Cecil
Norris, Steve


Freeman, Roger
Onslow, Rt Hon Cranley


Fry, Peter
Oppenheim, Phillip


Gale, Roger
Paice, James


Garel-Jones, Tristan
Patnick, Irvine


Gill, Christopher
Patten, Rt Hon Chris (Bath)


Glyn, Dr Sir Alan
Pattie, Rt Hon Sir Geoffrey


Goodlad, Alastair
Pawsey, James


Goodson-Wickes, Dr Charles
Porter, David (Waveney)


Gorman, Mrs Teresa
Price, Sir David


Gow, Ian
Raison, Rt Hon Timothy


Greenway, Harry (Ealing N)
Redwood, John


Greenway, John (Ryedale)
Renton, Rt Hon Tim


Griffiths, Peter (Portsmouth N)
Rhodes James, Robert


Ground, Patrick
Riddick, Graham


Grylls, Michael
Ridsdale, Sir Julian


Hamilton, Neil (Tatton)
Rifkind, Rt Hon Malcolm


Hanley, Jeremy
Rowe, Andrew


Hargreaves, A. (B'ham H'll Gr')
Shaw, Sir Giles (Pudsey)


Harris, David
Shaw, Sir Michael (Scarb')


Hayes, Jerry
Shepherd, Colin (Hereford)


Hayhoe, Rt Hon Sir Barney
Sims, Roger


Hind, Kenneth
Skeet, Sir Trevor


Hogg, Hon Douglas (Gr'th'm)
Smith, Sir Dudley (Warwick)


Howard, Rt Hon Michael
Smith, Tim (Beaconsfield)


Howarth, G. (Cannock &amp; B'wd)
Stanbrook, Ivor


Howe, Rt Hon Sir Geoffrey
Stanley, Rt Hon Sir John


Howell, Ralph (North Norfolk)
Stern, Michael


Hughes, Robert G. (Harrow W)
Stewart, Allan (Eastwood)


Irvine, Michael
Stewart, Rt Hon Ian (Herts N)


Jack, Michael
Stradling Thomas, Sir John


Janman, Tim
Summerson, Hugo


Johnson Smith, Sir Geoffrey
Taylor, John M (Solihull)


Key, Robert
Thompson, D. (Calder Valley)


King, Roger (B'ham N'thfield)
Thompson, Patrick (Norwich N)


Kirkhope, Timothy
Thorne, Neil


Kirkwood, Archy
Waddington, Rt Hon David


Knapman, Roger
Walker, Bill (T'side North)


Knight, Greg (Derby North)
Wallace, James


Knowles, Michael
Waller, Gary


Lawrence, Ivan
Watts, John


Lennox-Boyd, Hon Mark
Wells, Bowen


Lester, Jim (Broxtowe)
Widdecombe, Ann


Lightbown, David
Winterton, Mrs Ann


Lilley, Peter
Winterton, Nicholas


Lloyd, Peter (Fareham)
Wolfson, Mark


Lord, Michael
Wood, Timothy


Lyell, Rt Hon Sir Nicholas



Macfarlane, Sir Neil
Tellers for the Ayes:


MacGregor, Rt Hon John
Mr. Tim Devlin and


MacKay, Andrew (E Berkshire)
Mr. William Hague.


Maclean, David

Question accordingly agreed to.

Bill read the Third time, and passed.

Mrs. Fyfe: On a point of order, Madam Deputy Speaker. Since I do not have a bow tie, cane or tap shoes with me, you can understand my reluctance to don the top hat and go into a Ginger Rogers routine, although the top hat is disreputable enough for the "We're a couple of swells" routine. Given the propensity of former Cabinet Ministers to acquire lucrative directorships, have we any idea how many Conservative Members will profit from tonight's proceedings and when?

Madam Deputy Speaker: The hon. Lady waited a long time to put that point of order to me, but I must disappoint her by saying that it has nothing to do with the Chair.

ESTIMATES 1990–91

It being after Ten o'clock, MADAM DEPUTY SPEAKER proceeded, pursuant to paragraph (5) of Standing Order No. 52 (Consideration of Estimates), to put forthwith the deferred Questions necessary to dispose of the proceedings on Estimates 1990–91, Class II, Vote 2, Class II, Vote 4 and Class II, Vote 5.

CLASS II, VOTE 2

Resolved,

That a further sum, not exceeding £74,290,000 be granted to Her Majesty out of the Consolidated Fund to defray charges that will come in the course of payment during the year ending on 31st March 1991 for expenditure by the Foreign and Commonwealth Office on grants and subscriptions etc. to certain international organisations, certain grants in aid, special payments and assistance, scholarships, military aid and sundry other grants and services.—[Mr. Chapman.]

CLASS II, VOTE 4

Resolved,

That a further sum, not exceeding £45,583,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges which will come in course of payment during the year ending on 31st March 1991 for expenditure by the Foreign and Commonwealth Office on the British Council.—[Mr. Chapman.]

CLASS II, VOTE 5

Resolved,

That a further sum, not exceeding £860,719,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges which will come in course of payment during the year ending on 31st March 1991 for expenditure by the Foreign


and Commonwealth Office; Overseas Development Administration under the Overseas Development and Co-operation Act 1980 on the official United Kingdom aid programme and for assistance to Eastern Europe; including financial and technical assistance to governments, institutions, voluntary agencies and individuals; pensions and allowances in respect of overseas service including contributions to pension funds; capital and other subscriptions and contributions, including payments under guarantee, to multilateral development banks and other international and regional bodies; emergency, refugee and other relief assistance; loans to the Commonwealth Development Corporation; running costs, related capital expenditure, and other administrative costs including for the Overseas Development Natural Resources Institute (an executive agency).

BUSINESS OF THE HOUSE

Ordered,

That, at this day's sitting, the Ways and Means Motion may be proceeded with, though opposed, until any hour.— [Mr. Chapman.]

Finance Bill [Money] (No. 2)

Queen's Recommendation having been signified—

Motion made, and Question proposed,

That, for the purposes of any Act resulting from the Finance Bill, it is expedient to authorise the payment out of money provided by Parliament of any expenses of the Secretary of State attributable to provisions of the Act relating to levy on disposals of securities of companies to which the undertaking of a harbour authority is transferred and companies which control such companies.—[Mr. Lilley.]

Mr. Stuart Bell: I do not want to detain the House too long, but there are interesting aspects of the money resolution to which I want to draw the House's attention. It states:
for the puposes of any Act resulting from the Finance Bill, it is expedient to authorise the payment out of money provided by Parliament of any expenses of the Secretary of State attributable to provisions of the Act relating to levy on disposals of securities of companies to which the undertaking of a harbour authority is transferred and companies which control such companies.
I am not entirely sure whether we can hold the parliamentary draftsmen to account for the wording of the motion, but I am not aware that the Finance Bill spawns any Acts of Parliament. The money resolution applies only to
any Act resulting from the Finance Bill".
That raises interesting interpretations because it would clearly exclude the Tees and Hartlepool Port Authority Bill, currently going through the House under the private Bill procedure. It would also exclude the Clyde Port Authority Bill, which we have been debating on Third Reading since 7 o'clock and which now retires to the other place. It would also exclude any other privatised port where the private Bill procedure was adopted because none of that legislation, should it be enacted, results from the Finance Bill. It seems to me—I should be grateful if the Financial Secretary to the Treasury would confirm it—that the privatisation of the Tees and Hartlepool and the Clyde port authorities will be excluded from the operation of the money resolution.
It is also interesting that when one reads the resolution carefully it becomes apparent that, if it applies at all, it must also apply to public Bill procedure in relation to the privatisation of ports. Many hon. Members have objected

to the Government using private Bill procedure for the privatisation of the Tees and Hartlepool and the Clyde port authorities. The money resolution will enable the Government to take 50 per cent. of the assets of the port authorities when they are privatised. However, if there is to be any Act resulting from the Finance Bill in relation to the privatisation of the ports, that must cover a public Bill. In the Queen's Speech, the Government might propose privatising the 50 or so trust ports that will remain after the privatisation of the Tees and Hartlepool authority.
Therefore, I respectfully submit that the wording of the money resolution is defective because no Act arises from the Finance Bill. Such Acts can come only through the House, be initiated only by the Government, be debated only by this House and the other place and be voted on, so the Finance Bill has nothing to do with any other Act. If the day were to come when the Treasury sought to recover expenses as a result of that resolution, any authority that had been privatised would be entitled to go to the High Court, refer to the money resolution, and have it set aside as invalid. Even from the wording, one can see how invalid it is. It states:
for the purposes of any Act resulting from the Finance Bill".
I hope that the Financial Secretary to the Treasury is making a note of those points and will answer them at the end of the debate.
The money resolution is also interesting because it states:
it is expedient to authorise the payment out of money provided by Parliament".
What precisely does that mean? Does it mean that the Government will raid the reserves that are set aside as a result of votes in this Parliament? Will those amounts come from the so-called peace dividend, about which we have heard so much, or is that dividend all allocated to the Secretary of State for the Environment to cover the £3,500 million that he needs to put right—if he can—the consequences of the poll tax? Will there be a special impost on the entire electorate to cover those sums? Will taxes have to be raised or—to put it another way—will it now be impossible to reduce taxes? Why does the Financial Secretary to the Treasury feel that he has to come to the House tonight with this money resolution when we all know that the consequences of the privatisation of the Tees and Hartlepool authority will mean the disposal of about £60 million worth of assets?
If the Government carry out their intention of taking 50 per cent. of that money—£30 million—there would appear to be sufficient money in the Treasury kitty to cover the expenses, however much they may be. We have already debated Third Reading of the Clyde Port Authority Bill for three hours tonight and we know that this money resolution will cover that Bill, and that the Government—through the Treasury—propose to take 50 per cent. of the Clyde port authority's assets upon its privatisation.
My hon. Friends who represent Scottish constituencies may be able to tell me whether they know the precise asset value of the Clyde port authority, because I do not. If so, they would know how much the 50 per cent. that the Treasury proposes to take amounts to. But why do the Government come to the Floor of the House tonight to make special provision for the collection of those sums of money by the Treasury?

Mr. Bob Cryer: My hon. Friend will have noticed that the Minister has not opened the debate. Does my hon. Friend realise that the money resolution


contains no specific items for us to debate? The Finance Bill is still in Committee. So the Finance Bill Committee has not yet considered the items of legislation that the Minister is seeking the power to apply. He assumes that he will get the approval of the Committee tomorrow, and if the resolution is not approved tonight, he cannot deal with the items tomorrow in Committee. Does my hon. Friend agree that that is an outrageous abuse of parliamentary procedures?

Mr. Bell: I entirely agree with my hon. Friend, and I know that we are debating this resolution and the ways and means resolution that follows because the Finance Committee is to discuss a series of amendments tomorrow afternoon that will permit the Government to take 50 per cent. of the assets of the Tees and Hartlepool port authority and the Clyde port authority. The money resolution is synchronised with the Committee's business tomorrow.
I found it strange that the Financial Secretary to the Treasury came to the House tonight and did not open this short debate on the money resolution, although we anticipated that he would. So, it again falls to the Opposition to make relevant points, to elucidate and to elicit answers from the Minister—but we have the silence of the graveyard from the Government Front Bench. It diminishes and demeans the House and parliamentary democracy when Ministers come to the Dispatch Box but do not make a speech.

Mr. Martin Redmond: I am also surprised that the Minister failed to open the debate and to explain what is involved in the resolution.
My hon. Friend mentioned assets and the way in which they will be divided. The value of assets is decided by whoever does the valuation. Given the Government's track record on the valuations that they have put on the various lands that have been flogged off to the private sector, perhaps my hon. Friend can tell me whether the assets will be correctly valued and sold to the private sector for the market price, or whether the Financial Secretary will continue to put sweeteners into the system. If the Financial Secretary had spoken, he could well have answered, but I have to ask my hon. Friend, who may or may not be aware of how the valuation is to be done.

Mr. Bell: I have no doubt that the asset value will be left to market forces. We are aware that Tees and Hartlepool port authority and Clyde port authority have valuable land assets and we do not know how they will be valued. It is interesting that my hon. Friend should make that point, because he has followed the Associated British Ports (No. 2) Bill through the House in all its stages. Will the Financial Secretary tell us whether the money resolution is restrospective? Will it cover other port privatisations? Is the Minister nodding or shaking his head? If he wishes to intervene to clarify the matter, I shall gladly yield the floor to him. He remains seated. No doubt he will answer my points when he replies to the debate.

Mr. Frank Haynes: The Government are at it again. They are always at it. They are putting the cart before the horse again. They have sent the errand boy from Committee to try to persuade us to agree to what they want. They are in a mess. My hon. Friend the Member for Bradford, South (Mr. Cryer) was correct.
Does my hon. Friend the Member for Middlesbrough (Mr. Bell) agree that the Chair now has an opportunity to put the matter right? The Government have put the cart before the horse. It is a swindle and a fix, and the Government are always at it. It is high time that it stopped.

Mr. Bell: I agree with my hon. Friend, although I am not sure whether he was raising a point of order with the Chair or asking me a question to which he wishes me to reply. All hon. Members who have sat through the Government's remarkable proceedings on private Bills, which are in fact often hybrid Bills, will understand our problem. There was a three-hour debate earlier this evening on the privatisation of the Clyde port authority. That has now been followed by a money resolution, which is linked to that Bill, but which has been carefully separated from it so that the Bill would not be hybrid and disallowed by the House authorities.
The Minister for Aviation and Shipping has made a variety of statements, making it clear that privatisation is the route that the Government wish all the trust ports to take. However, the Government do not have the time to take the privatisations through the House in the form of a public Bill instead, they use a private Bill procedure linked to a money resolution. That is what happens after 11 years of a Government with a large majority. They pervert the procedures, customs and traditions of the House. That results in us ending up at 10.30 pm on a Monday with the Financial Secretary not intervening to answer the valid points raised by my hon. Friends and myself.
I wish to refer to the aspect of the money resolution dealing with expenses. What expenses did the Financial Secretary have in mind when he drew up the money resolution? What expenses will be incurred by the Treasury in collecting £30 million from the assets of Tees and Hartlepool? Does he envisage any difficulty in raising that money? Will he raid the petty cash? Will he send an inspector—

Mr. Redmond: On a point of order, Mr. Deputy Speaker. My hon. Friend the Member for Middlesbrough (Mr. Bell) is asking the Minister several questions. The Minister failed to introduce the money resolution; he has simply sat there nodding or shaking his head. Can you, Mr. Deputy Speaker, tell us whether the Minister intends to stand at the Dispatch Box and answer some of the questions asked by my hon. Friends? I object to the Minister not having given a lead into this important subject.

Mr. Cryer: Further to that point of order—

Mr. Deputy Speaker (Mr. Harold Walker): Order. It was not a point of order, so it is not a matter for me.

Mr. A. J. Beith: On a point of order, Mr. Deputy Speaker. Before the Minister replies to the debate, would not it be desirable for several hon. Members to have the opportunity to take part in it? Am I right in thinking that there is a strict time limit of 45 minutes for the debate? Will not mutual tolerance have to be shown by hon. Members if we are all to have the opportunity to speak?

Mr. Deputy Speaker: I gather that the feeling of the House is that there should be sufficient time to allow the


Minister to comment on the matters that have been raised in the debate. I hope that hon. Members will bear that in mind, should they catch my eye.

Mr. Cryer: On a point of order, Mr. Deputy Speaker. There is a problem for the House, in that as the Minister did not speak first, because he was trying to get the resolution through on the nod, we do not have information on what it relates to. As I said earlier, it does not appear in the only copy that we have of the Finance Bill. The Committee considering that Bill is due to finish tomorrow, and in the ordinary course of events, the day after that a copy of the Bill as amended in Committee would be published, incorporating any new clauses related to any money resolutions that the Committee decided to approve. We do not have that information, so we are not in a position to make a decision, until and unless the Minister explains the relationship between the Bill and the resolution. He should have spoken first.

Mr. Deputy Speaker: Perhaps the hon. Member for Middlesbrough (Mr. Bell) should be given the opportunity to conclude his speech. No doubt, the Financial Secretary will bear in mind what has been said.

Mr. Bell: I am always grateful for guidance from the Chair, but, like the House, I anticipated that the Financial Secretary would open the debate. We are aware that we have only 45 minutes to debate the issues that the money resolution raises. I should not wish to curtail my remarks, only to find that the debate has been cut to 25 minutes because the Financial Secretary declines to say anything. We have had no sign from those on the Treasury Bench, nor from you, Mr. Deputy Speaker, because you cannot say, whether the Financial Secretary will speak. If he tells us that he will, I shall take that into account.

The Financial Secretary to the Treasury (Mr. Peter Lilley): I assure the hon. Gentleman that he will not escape without hearing my words of wisdom on the subject.

Mr. Bell: I am grateful to the hon. Gentleman.
I was asking the Financial Secretary what expenses he thought would be incurred in taking away from the assets of privatised ports 50 per cent. of their value, and about which ports we are talking—those about to be privatised as a result of Bills going through the House, or those that may be privatised as the result of a Government proposal, set out in the Queen's Speech, to privatise all the ports in the land. It would be interesting to know what expenses he has in mind.
The money resolution deals with a levy on disposal of securities. Which securities does the Financial Secretary have in mind? How does he see that disposal? Is he talking about cash in hand or cash in the bank, or about assets that have grown up in the port authorities over many years? Is he talking about assets developed from past Government grants? In the case of the Tees and Hartlepool port authority, the Government's excuse for taking away 50 per cent. of its assets was that the Government gave grants to it 20 years ago.
It would be wrong if, when the Treasury is talking about a levy on the disposal of securities, it was talking about all the securities rather than those into which there has been a grant input from the Government. I am aware that the Public Accounts Committee likes the idea that,

where there has been an input from the Treasury to build up the assets of a port authority such as Tees and Hartlepool, there ought to be a return on that investment. However, it seems rather far fetched for the Treasury to take 50 per cent. of all the assets, regardless of whether there has been any input from the Treasury, and then for the Government to come to the House at this time of night to pass a resolution entitling the Treasury to collect the expenses of collecting money to which it has no entitlement. That draws attention to the manner in which the Government operate and to the arrogant way in which they deal with the House and with ports that are being privatised at their behest. At the time of the privatisation proposals, no one was told that 50 per cent. of the assets would go and that the Government would come to the House tonight to collect their expenses from the national purse.
The resolution refers to harbour authorities. Either the parliamentary draftsman or the Financial Secretary to the Treasury is at fault because in the case of Tees and Hartlepool or the Clyde port authority we are dealing not simply with harbour undertakings but with port undertakings. There is a difference in law between a port and a harbour. Tees and Hartlepool and the Clyde port authority could well argue that they have port responsibilities rather than simply harbour responsibilities. Again, the resolution is defective. When the Treasury seeks to collect those expenses from a variety of privatised ports, there will be every reason for those ports to go to court and say that the provisions do not apply to them because they are more than harbour authorities: they are port authorities, and the wording of the resolution limits the collection of any expenses to harbour authorities. Again, the parliamentary draftsman or the Financial Secretary to the Treasury, whom I should expect to take full responsibility for the resolution, seems to be building up a court case.
The resolution refers to the transfer to companies and other
companies which control such companies".
Whom does the Financial Secretary have in mind? Does he accept the principle that Opposition Members have been arguing for many a long day and night that the privatised ports will end up in the hands of conglomerates such as P and 0 and Trafalgar House? They may be part of an expansion programme by Associated British Ports or they may end up in foreign hands. The resolution covers that eventuality by inserting provisions into the Finance Bill relating to the companies in control. When those assets are ultimately transferred into third party hands, the Treasury will be entitled under the money resolution to collect from those companies.
The wording of the resolution reveals the Government's ultimate hand. First, they wish the ports to be privatised. Secondly, they wish to take 50 per cent. of their assets. Thirdly, the Treasury wishes to collect its expenses. Fourthly, the Government anticipate that the companies will end up in the hands of conglomerates and that ports on the Tees, on the Clyde and other ports will be gobbled up when they are privatised or when the Government coerce them into the private sector.
It has not been a wasteful debate. It is not a question of passing the time of day, but it involves holding the Government to account on what appears to be defective wording, which will be challenged in the courts if any of the companies that may be affected by it are so minded.
The resolution cannot distinguish between a port and a harbour: it relates to Acts of Parliament arising and resulting from the Finance Bill. The wording is slothful. The Financial Secretary to the Treasury will have to explain it to the House and to the Finance Bill Committee tomorrow and eventually the courts will have to interpret it.

Mr. A. J. Beith: The purpose of the money resolution and the Ways and Means resolution is to enable this tax-raising Government to raise another new tax. In this instance, the tax would not necessarily be levied at 50 per cent., as the Government say, but in some circumstances at 100 per cent. or 110 per cent.
The Government have discovered that trust ports have money which does not seem to belong to anyone. Under this Government, the Exchequer assumes that if money does not belong to anyone in particular it ought to belong to the Exchequer and therefore the largest possible amount should be seized as quickly as possible. The effect of the proposals is to enable the Government to pay the expenses of collecting a tax, levied at 50 per cent. of the market value of the securities disposed of when trust ports are privatised.
It is relevant to remember that the market value is not necessarily the price for which the shares in the privatised ports will be sold. The Revenue may deem it to be considerably higher, and 50 per cent. of what the Revenue deems to be the market value may be as much as 100 per cent. of the value for which the securities were sold. It is rather like the Trustee Savings Bank case. The money that shareholders pay when they buy shares in a privatised trust port goes to the port and adds to the existing assets in which they are seeking to buy a share. The end result is that the value of the company is the original assets and the price paid for the shares. The tax is levied at 50 per cent. of that total. It may therefore be 100 per cent. of the original value of the port before privatisation. The Government owe an explanation as to why they are proposing to levy a tax on money which was never theirs, and at a rate potentially much higher than 50 per cent.
If one argues, as it is reasonable to argue, that there is a large windfall gain in privatisations, why should it go to the Exchequer? Why should it not go to the companies concerned and the communities in which the ports are situated? Why should it not go to the local authorities in those areas, or into a common good fund, the trustees of which could apply the money for the benefit of those areas? Why is not any levy on the privatisation process structured to ensure that it benefits the ports and the areas alongside the ports where services have to be provided such as the roads leading to the port areas?
No argument can be made for the Exchequer to claim all this money, and the argument is not being advanced by the privatising ports. They are not saying to the Government, "Please take all this money off us—we are embarrassed about having it." It would be better for the money to be given to local communities. Far from the Government encouraging the privatisation of ports under these proposals, some ports will say, "If all the money is going to the Exchequer, we do not want to follow the route of privatisation".

Mr. Deputy Speaker: Order. I can see the hon. Gentleman's difficulty, but he is anticipating the debate on the next motion rather than debating the money resolution.

Mr. Beith: I took advice from the Clerks before deciding whether to attempt to make two speeches or to summarise my remarks as succinctly as possible in one speech. I have opted, so far as possible, for the latter course.
My main purpose is to argue that the House, and particularly Conservative Members, should realise before passing the money resolution that we are providing for the defraying of expenses of collecting a new tax—a tax that may be levied at a high level—to which the Exchequer has no right or claim, certainly none based on the grants that it may have given to the ports, because those are repaid as part of the privatisation process.
The Government owe it to the House to explain why they are trying to levy such a tax, why they are trying to give the Exchequer money to which it has no right, why they are not trying to ensure that the money remains in the communities and with those who work in the ports, and why they are complicating the process of privatisation with a resolution for which there appears to be no demand in the ports concerned.
We shall get down to the detail in the Finance Bill Committee tomorrow. Having introduced a new clause on this subject, the Government withdrew it. Late on Friday, they retabled the new clause. Once again, it will be before the Standing Committee for tomorrow's sitting. The Government seem to be in considerable confusion about what they are doing. That is hardly surprising for a Government who are supposed to be getting rid of taxes but in fact are introducing yet another new tax on a basis for which there seems to be no defence.

Mr. Bob Cryer: It is clearly necessary to debate money motions every time they arise. As the House knows, I have paid assiduous attention to these matters over many months. There have not been many money motions in past months, so it is appropriate that I should spend a few moments on this one, giving the Minister the opportunity to make the speech that he should have made at the beginning.
It is extraordinary that the Executive should try to get such a motion through the House on the nod. No doubt the Minister had a few notes prepared, just in case the Opposition were scrupulous enough, as we always are, to check on the way in which the Government were trying to dodge the measure through the House. It is outrageous that the Vote Office has nothing available in connection with the Finance Bill and this money motion. A new clause has not yet been added to the Finance Bill to link it.

Mr. Lilley: The new clauses were put down on the amendment paper today.

Mr. Cryer: I imagine that the hon. Gentleman regards that as some sort of administrative triumph. He has God knows how many civil servants working for him and an office full of additional civil servants in his private office, but he could not get the clauses tabled until the very day when Parliament is debating the issue.
The new clauses were not available for hon. Members to take home and study at the weekend so that we could


come prepared to debate what we were told last Thursday was on the Order Paper. Why were the new clauses not tabled last Thursday? We could then have taken them home, got some information from the Library and been ready to subject the Minister to a thorough cross-examination. The hon. Gentleman tabled them today because he was trying to dodge accountability, just as he was trying to dodge accountability by sitting on his bottom when he should have been up explaining exactly what this was about. He should have been admitting shamefacedly to the House that the Government had made a botch of it, as they always do. The Government are abusing the democratic processes and shovelling so much legislation through that the House does not have time to debate the money motion properly.
A satisfactory amount of information is not before the House. New clauses may have been tabled to the Finance Bill, but they will be considered by the Standing Committee. Strictly, they do not have anything to do with the House. They may not be passed. The Government get the estate agents, merchant bankers and other riffraff on the Tory Benches into the Committee, tell them to "Vote this way", and expect the measures to be passed automatically without any debate or mature judgment of the issues. That is wrong. It is an affront to the intelligences even of some Conservative Members, although that is not a strong point to make.
The Minister could have helped the House a great deal if he had said all this at the beginning. He did not do so because he hoped—as the Government hope on so many occasions—to get a money motion passed on the nod. That is why I invariably speak—to disappoint the Government in that expectation, if in no other.
What annual expenditure is involved? It is an open-ended invitation to the Minister to spend what he likes. It is outrageous that we have this motion before us.
The measure is designed to obtain revenue from the transfer of the trust ports, which is being effected by private Bills. There are now so many private Bills going through the House that the Government have had to table a resolution at this late stage. I understand that the Finance Bill Committee is due to finish its deliberations tomorrow. That means that this is the last occasion on which the Government can table clauses for the Committee to consider, so the Minister's boast that the Government tabled the clauses today is an implicit admission of incompetence on his part and that of the Government. They could not have tabled them after today and they will lose the right to milk the trust ports if the resolution is not carried tonight. That is why I suggest to my hon. Friends that we should vote on the resolution and prevent its being passed. We should make sure that people understand that we know of the dodges that the Tory Government are setting about in Parliament and that, although they have a majority of 150, we intend to do our best to ensure that the resolution does not go through on the nod.
There is an important relationship between private and public Bills. As a number of Opposition Members have said, the Government are using the private Bill procedure as though it were a public Bill system of which they can take advantage. The resolution, which would enable the Government to milk the trust ports by imposing a levy, is

a direct example of that. If the Government did not have an organised system for piloting private Bills through Parliament, they would not need such a resolution.

Mr. Redmond: Perhaps my hon. Friend could explain the levy. The Committee may see the relevant documentation tomorrow, but when I went to the Vote Office and asked for information relating to this and to the next item on the Order Paper, I was informed that it was not available. If my hon. Friend has the proposals, perhaps he could pass them around. Indeed, the Minister could have passed them round. After all, the Government are spending millions of pounds distributing leaflets on their NHS proposals.

Mr. Cryer: I know that my hon. Friend is extremely concerned at the abuse of the House that the use of the private Bill procedure represents. We all know that my hon. Friend is honoured for holding the Executive to account on these issues.
I shall not take much longer, although I must say to the Minister, who is looking at his watch, that there will be plenty of time later. I can rely on the Minister to use his ingenuity to include any explanations that he is prevented by shortage of time from using on this resolution by his speech on the Ways and Means resolution. I do not know about my hon. Friends, but I believe that we should have a close look at that, too. If we are not satisfied—even though the debate can go on for some time—it would not be imprudent to consider voting on the Ways and Means resolution. But we shall come to that. The Minister has several minutes to make the speech that he should have made at the beginning of the debate and I now give him the opportunity to do so.

The Financial Secretary to the Treasury (Mr. Peter Lilley): I am glad that I did not speak at the start of the debate because I could not have forecast exactly the questions that hon. Members have properly raised. I shall do my best to respond to as many of them as I can and I shall take the opportunity, as the hon. Member for Bradford, South (Mr. Cryer) suggested, to answer any outstanding questions in the subsequent debate, to which I look forward.
The resolution simply authorises the expenditure of moneys on the administration of the levy that the clauses that we shall consider in the Finance Bill Committee tomorrow would impose on any port that privatised itself. That admistrative expenditure applies only to the operation of the levy. The money resolution will not enable us to expend moneys on the privatisation of ports; the House can rest assured on that.
I was asked what was meant by
any Act resulting from the Finance Bill".
It is, of course, the Finance Act which will result from the Finance Bill and not any private Act resulting from a private Bill now going through the House. Normally, the moneys raised used for any administrative expenditures under the Finance Bill money resolution will come from Department of Transport voted expenditure headlined for administration.
The hon. Member for Bradford, South intervened in the speech of his hon. Friend the Member for Middlesbrough (Mr. Bell) and asked about the non-availability of clauses. I explained that they were tabled on Friday, published on Saturday, and appear on


today's Order Paper. We are not debating those clauses. That will be a task for the Finance Bill Standing Committee. We tabled the clauses so that we could debate them in Committee, although we could have tabled them later on Report had we so wished and had we any subversive intent, which of course we have not.
The hon. Member for Middlesbrough asked whether the resolution is retrospective. It is not. He also asked whether we were in any way using private Bills to privatise ports. By definition, private Bills are private and the private institution—in this case the port—brings forward the Bill, not the Government.
The hon. Member for Middlesbrough also asked about the nature of the expenses that might be incurred under the money resolution. They would include valuation costs of the proceeds of sale, determining whether the levy is payable and general administrative and collection costs. I suspect that those costs will not be large, but it is right that we should receive proper authorisation before they can be undertaken.
The hon. Member for Middlesbrough also asked what securities are mentioned in the Bill. They are shares in the company, debentures, stocks and bonds and not anything owned by the company. He also asked whether it was right to refer to harbour authorities rather than port authorities. I am reliably informed that all port authorities are harbour authorities.
The hon. Member for Berwick-upon-Tweed (Mr. Beith) said that we were taking the opportunity to impose a tax and that the money should instead in some way be channelled to employees, local authorities and the area in general. He will find from the clauses that up to 3 per cent. of the proceeds can go to employees, and that will be a larger proportion than in any other sale. It is intended that 50 per cent. of the proceeds will be left with the company and liable to taxation. Privatisation—

It being three-quarters of an hour after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 14 (Exempted business).

The House divided: Ayes 121, Noes 30.

Division No. 275]
[10.09 pm


AYES


Aitken, Jonathan
Bowis, John


Alexander, Richard
Braine, Rt Hon Sir Bernard


Allason, Rupert
Brandon-Bravo, Martin


Amess, David
Brazier, Julian


Arbuthnot, James
Bright, Graham


Arnold, Jacques (Gravesham)
Brown, Michael (Brigg &amp; Cl't's)


Atkins, Robert
Browne, John (Winchester)


Baker, Nicholas (Dorset N)
Buck, Sir Antony


Batiste, Spencer
Budgen, Nicholas


Beaumont-Dark, Anthony
Butterfill, John


Beith, A. J.
Campbell, Menzies (Fife NE)


Bellingham, Henry
Carlisle, Kenneth (Lincoln)


Bendall, Vivian
Carrington, Matthew


Bennett, Nicholas (Pembroke)
Chalker, Rt Hon Mrs Lynda


Benyon, W.
Chapman, Sydney


Blaker, Rt Hon Sir Peter
Chope, Christopher


Boscawen, Hon Robert
Clark, Dr Michael (Rochford)


Boswell, Tim
Clark, Sir W. (Croydon S)


Bowden, Gerald (Dulwich)
Colvin, Michael






Coombs, Anthony (Wyre F'rest)
McLoughlin, Patrick


Coombs, Simon (Swindon)
Malins, Humfrey


Cran, James
Marshall, John (Hendon S)


Currie, Mrs Edwina
Marshall, Sir Michael (Arundel)


Davies, Q. (Stamf'd &amp; Spald'g)
Martin, David (Portsmouth S)


Davis, David (Boothferry)
Maxwell-Hyslop, Robin


Day, Stephen
Mayhew, Rt Hon Sir Patrick


Douglas-Hamilton, Lord James
Miller, Sir Hal


Dunn, Bob
Mitchell, Andrew (Gedling)


Durant, Tony
Mitchell, Sir David


Fairbairn, Sir Nicholas
Moate, Roger


Fallon, Michael
Monro, Sir Hector


Field, Barry (Isle of Wight)
Montgomery, Sir Fergus


Fishburn, John Dudley
Morris, M (N'hampton S)


Fookes, Dame Janet
Moss, Malcolm


Forsyth, Michael (Stirling)
Neale, Gerrard


Forth, Eric
Neubert, Michael


Fox, Sir Marcus
Nicholson, David (Taunton)


Franks, Cecil
Norris, Steve


Freeman, Roger
Onslow, Rt Hon Cranley


Fry, Peter
Oppenheim, Phillip


Gale, Roger
Paice, James


Garel-Jones, Tristan
Patnick, Irvine


Gill, Christopher
Patten, Rt Hon Chris (Bath)


Glyn, Dr Sir Alan
Pattie, Rt Hon Sir Geoffrey


Goodlad, Alastair
Pawsey, James


Goodson-Wickes, Dr Charles
Porter, David (Waveney)


Gorman, Mrs Teresa
Price, Sir David


Gow, Ian
Raison, Rt Hon Timothy


Greenway, Harry (Ealing N)
Redwood, John


Greenway, John (Ryedale)
Renton, Rt Hon Tim


Griffiths, Peter (Portsmouth N)
Rhodes James, Robert


Ground, Patrick
Riddick, Graham


Grylls, Michael
Ridsdale, Sir Julian


Hamilton, Neil (Tatton)
Rifkind, Rt Hon Malcolm


Hanley, Jeremy
Rowe, Andrew


Hargreaves, A. (B'ham H'll Gr')
Shaw, Sir Giles (Pudsey)


Harris, David
Shaw, Sir Michael (Scarb')


Hayes, Jerry
Shepherd, Colin (Hereford)


Hayhoe, Rt Hon Sir Barney
Sims, Roger


Hind, Kenneth
Skeet, Sir Trevor


Hogg, Hon Douglas (Gr'th'm)
Smith, Sir Dudley (Warwick)


Howard, Rt Hon Michael
Smith, Tim (Beaconsfield)


Howarth, G. (Cannock &amp; B'wd)
Stanbrook, Ivor


Howe, Rt Hon Sir Geoffrey
Stanley, Rt Hon Sir John


Howell, Ralph (North Norfolk)
Stern, Michael


Hughes, Robert G. (Harrow W)
Stewart, Allan (Eastwood)


Irvine, Michael
Stewart, Rt Hon Ian (Herts N)


Jack, Michael
Stradling Thomas, Sir John


Janman, Tim
Summerson, Hugo


Johnson Smith, Sir Geoffrey
Taylor, John M (Solihull)


Key, Robert
Thompson, D. (Calder Valley)


King, Roger (B'ham N'thfield)
Thompson, Patrick (Norwich N)


Kirkhope, Timothy
Thorne, Neil


Kirkwood, Archy
Waddington, Rt Hon David


Knapman, Roger
Walker, Bill (T'side North)


Knight, Greg (Derby North)
Wallace, James


Knowles, Michael
Waller, Gary


Lawrence, Ivan
Watts, John


Lennox-Boyd, Hon Mark
Wells, Bowen


Lester, Jim (Broxtowe)
Widdecombe, Ann


Lightbown, David
Winterton, Mrs Ann


Lilley, Peter
Winterton, Nicholas


Lloyd, Peter (Fareham)
Wolfson, Mark


Lord, Michael
Wood, Timothy


Lyell, Rt Hon Sir Nicholas



Macfarlane, Sir Neil
Tellers for the Ayes:


MacGregor, Rt Hon John
Mr. Tim Devlin and


MacKay, Andrew (E Berkshire)
Mr. William Hague.


Maclean, David





NOES


Armstrong, Hilary
Clarke, Tom (Monklands W)


Barnes, Harry (Derbyshire NE)
Cohen, Harry


Beckett, Margaret
Cryer, Bob


Bell, Stuart
Davis, Terry (B'ham Hodge H'l)


Bermingham, Gerald
Dixon, Don


Brown, Nicholas (Newcastle E)
Dunnachie, Jimmy


Buckley, George J.
Eadie, Alexander


Carr, Michael
Ewing, Harry (Falkirk E)





Flynn, Paul
Nellist, Dave


Foster, Derek
Powell, Ray (Ogmore)


Fyfe, Maria
Redmond, Martin


Godman, Dr Norman A.
Sillars, Jim


Graham, Thomas
Skinner, Dennis


Griffiths, Nigel (Edinburgh S)
Spearing, Nigel


Haynes, Frank
Strang, Gavin


Hinchliffe, David
Wareing, Robert N.


Ingram, Adam
Welsh, Andrew (Angus E)


Lambie, David
Wilson, Brian


Lofthouse, Geoffrey
Worthington, Tony


McFall, John



McKelvey, William
Tellers for the Noes:


Mahon, Mrs Alice
Mr. Mike Watson and


Michael, Alun
Mr. Ian McCartney.


Michie, Bill (Sheffield Heeley)

Division No. 276]
[11.07 pm


AYES


Alexander, Richard
Chalker, Rt Hon Mrs Lynda


Allason, Rupert
Chapman, Sydney


Amess, David
Chope, Christopher


Arbuthnot, James
Clark, Dr Michael (Rochford)


Arnold, Jacques (Gravesham)
Coombs, Anthony (Wyre F'rest)


Batiste, Spencer
Coombs, Simon (Swindon)


Bellingham, Henry
Cran, James


Bennett, Nicholas (Pembroke)
Currie, Mrs Edwina


Boscawen, Hon Robert
Davies, Q. (Stamf'd &amp; Spald'g)


Boswell, Tim
Davis, David (Boothferry)


Bowis, John
Day, Stephen


Brandon-Bravo, Martin
Devlin, Tim


Brazier, Julian
Douglas-Hamilton, Lord James


Bright, Graham
Durant, Tony


Brown, Michael (Brigg &amp; Cl't's)
Fairbairn, Sir Nicholas


Browne, John (Winchester)
Fallon, Michael


Burt, Alistair
Fishburn, John Dudley


Carlisle, Kenneth (Lincoln)
Fookes, Dame Janet


Carrington, Matthew
Forsyth, Michael (Stirling)





Forth, Eric
Moate, Roger


Franks, Cecil
Montgomery, Sir Fergus


Freeman, Roger
Morris, M (N'hampton S)


Gale, Roger
Moss, Malcolm


Garel-Jones, Tristan
Neale, Gerrard


Gill, Christopher
Neubert, Michael


Glyn, Dr Sir Alan
Nicholson, David (Taunton)


Gow, Ian
Norris, Steve


Greenway, John (Ryedale)
Oppenheim, Phillip


Griffiths, Peter (Portsmouth N)
Paice, James


Ground, Patrick
Patnick, Irvine


Hague, William
Pawsey, James


Hamilton, Neil (Tatton)
Porter, David (Waveney)


Hanley, Jeremy
Price, Sir David


Hargreaves, A. (B'ham H'll Gr')
Raison, Rt Hon Timothy


Harris, David
Redwood, John


Hind, Kenneth
Renton, Rt Hon Tim


Hogg, Hon Douglas (Gr'th'm)
Rhodes James, Robert


Howard, Rt Hon Michael
Rowe, Andrew


Howarth, G. (Cannock &amp; B'wd)
Shaw, David (Dover)


Howe, Rt Hon Sir Geoffrey
Shepherd, Colin (Hereford)


Hughes, Robert G. (Harrow W)
Smith, Sir Dudley (Warwick)


Irvine, Michael
Stanbrook, Ivor


Jack, Michael
Stern, Michael


Janman, Tim
Stevens, Lewis


King, Roger (B'ham N'thfield)
Stewart, Allan (Eastwood)


Knapman, Roger
Stewart, Andy (Sherwood)


Knight, Greg (Derby North)
Stradling Thomas, Sir John


Knowles, Michael
Summerson, Hugo


Lawrence, Ivan
Taylor, John M (Solihull)


Lester, Jim (Broxtowe)
Thompson, D. (Calder Valley)


Lightbown, David
Thompson, Patrick (Norwich N)


Lilley, Peter
Thorne, Neil


Lyell, Rt Hon Sir Nicholas
Twinn, Dr Ian


Maclean, David
Walker, Bill (T'side North)


McLoughlin, Patrick
Widdecombe, Ann


Malins, Humfrey
Winterton, Mrs Ann


Marshall, Sir Michael (Arundel)
Winterton, Nicholas


Martin, David (Portsmouth S)
Wolfson, Mark


Maxwell-Hyslop, Robin



Mayhew, Rt Hon Sir Patrick
Tellers for the Ayes:


Miller, Sir Hal
Mr. Nicholas Baker and


Mitchell, Andrew (Gedling)
Mr. Timothy Wood.


Mitchell, Sir David

Question accordingly agreed to.

Resolved,

That, for the purposes of any Act resulting from the Finance Bill, it is expedient to authorise the payment out of money provided by Parliament of any expenses of the Secretary of State attributable to provisions of the Act relating to levy on disposals of securities of companies to which the undertaking of a harbour authority is transferred and companies which control such companies.

Ways and Means

LEVY ON PORT PRIVATISATIONS

Motion made, and Question proposed,
That provision may be made for a levy on disposals of securities of companies to which the undertaking of a harbour authority is transferred and companies which control such companies and for the payment into the Consolidated Fund of payments of levy, interest on unpaid levy and penalties in respect of levy.—[Mr. Lilley.]

Mr. Bob Cryer: On a point of order, Mr. Deputy Speaker. Notices of amendments were given to Standing Committee E on the Finance Bill and they relate to the two resolutions, the first of which has just been disposed of. Will it be in order to discuss any of the new clauses, which are clearly relevant to the debate? Are the new clauses the property of the Committee until it makes a decision and reports to the House? I think that I know the answer to my questions, but, naturally, I seek your confirmation and guidance. If we are excluded from debating these matters, the House is being outrageously dealt with by the Government.

Mr. Deputy Speaker (Mr. Harold Walker): The hon. Gentleman is interpreting the advice that has been given to me, which is that it would be in order to discuss the matters to which the motion applies.

The Financial Secretary to the Treasury (Mr. Peter Lilley): I shall endeavour to respond to some of the points raised but not answered on the previous motion. I shall be as brief as possible because I know that the House does not want to keep itself from its bed.
The Government have tabled six new clauses to the Finance Bill to provide for a 50 per cent. levy on the proceeds of the privatisation of trust ports. The House will be aware that two trust ports—the Tees and Hartlepool port authority and the Clyde port authority—are seeking to turn themselves into companies by means of private Acts of Parliament. The Government welcome that initiative because we see considerable benefits from early privatisation which will remove unnecessary restrictions on the way in which the port businesses can be developed, allow ports to develop their assets and give them a more flexible capital base while exposing them more fully to the disciplines of the market. The Government believe that privatisation will increase the efficiency of the trust ports and lead to a better service to port users.
The trust ports are owned not by the Government but by the state. It must be for Parliament to decide who should benefit from the proceeds of sale. In the Government's view, a proportion of the proceeds should go to the Exchequer. The clause provides that this proportion should be 50 per cent. It is a matter of judgment what the right proportion should be. In making their decision, the Government have tried to be fair to all the parties involved, including the ports and the Exchequer.

Mr. Tim Devlin: Will the only deductions from the capital raised by the flotation be the 50 per cent. taken by the Government, or will tax be levied on top of that?

Mr. Lilley: Tax will apply to the proceeds in the normal way, but the levy will be a cost to be deducted in calculating any capital gain, which will be liable to capital gains tax. Therefore, the capital gain left after the levy will bear the burden of capital gains tax.

Mr. Devlin: What proportion of the total proceeds will be left with the successor companies?

Mr. Lilley: Clearly the proportion will be somewhat less than 50 per cent. How much capital gains tax is required will depend on the capital gain and the companies' ingenuity in reducing the capital gains tax that they pay.

Mr. A. J. Beith: A moment ago the Minister said that the ports were owned by the state. What is the state in this context? If it is not the Crown, can he explain any basis of English law in which there is something called the state which can own ports?

Mr. Lilley: It was the courts which used the term "owned by the state". It is not a term that we have added to their vocabulary. It comes from the vocabulary of the courts.
It is a matter of judgment to decide what is the right proportion that should be taken in the form of a levy. In making their decision, the Government have tried to be fair to all parties, including both the ports and the Exchequer. We had to take into account several factors. Factors which suggested a higher Exchequer share included the need to safeguard the interests of the taxpayer, who has contributed to the development of the trust ports, albeit on a relatively modest scale; and the need to ensure a level playing field between the newly privatised trust ports and ports already in the private sector. Allowing the trust ports to keep the majority of the proceeds would give them an unfair commercial advantage over ports already operating privately.
There were several arguments in favour of a lower Exchequer share. They included the desirability of rewarding the initiative shown by authorities such as the Tees and Hartlepool and the Clyde port authorities of introducing private Bills; the benefits of early privatisation; the need to retain an incentive for other trust ports to seek privatisation; and, of course, the ports' intention to use some of the funds to invest in new developments and develop their existing assets.

Mr. Devlin: I apologise for interrupting my hon. Friend again. If the proposals are accepted—this is of fundamental importance to the privatisation of the two ports—there will be no incentive for any other port to follow in their footsteps. Secondly, there will be no proper reward for the two companies that so bravely went forward where others feared to tread. Thirdly, benefit will be lost to the peoples of the Clyde and Teesside, who would otherwise have benefited, because in both instances the ports will have to go to the markets in London for their flotations if they are to make a real profit. That will be a disaster for my constituents and for the constituents of Clydeside Members.

Mr. Lilley: My hon. Friend is unduly pessimistic. I am surprised to find that he has an ally in the hon. Member for Bradford, South (Mr. Cryer). I do not accept my hon. Friend's suggestion that the ports will have no incentive to privatise. They will retain 50 per cent. of the funds.

Mr. Devlin: My hon. Friend said that that would be taxed.

Mr. Lilley: Of course. The receipts will be subject to capital gains tax. That has always been the position and it is not being altered. We are merely reducing the net assets that will be liable to taxation.
The incentive to privatise is not only to retain funds from the issue. The ports have made a strong case—I consider it to be a convincing one—that they are hampered by the present deeds and structure of their make-up. They wish to have a private company structure and to be freed from the limitations that are now imposed on the activities in which they can engage. They would not desist because the money that they obtain will be somewhat less than previously was estimated. It seems not unreasonable that we would take 50 per cent. of the proceeds. I recall that we took 100 per cent. in the case of Associated British Ports. I do not take the pessimistic view of my hon. Friend the Member for Stockton, South (Mr. Devlin).

Mr. Stuart Bell: If 50 per cent. of the assets are to be taken by the Government, that leaves 50 per cent. of the proceeds. If 40 per cent. is the higher rate of capital gains tax, is it not right that 40 per cent. of the 50 per cent. will further be taken by the Government?

Mr. Lilley: I imagine that in this instance capital gains tax will be paid at the corporation tax rate rather than at the higher rate of CGT, and that is 35 per cent.

Mr. Dennis Skinner: Is the Minister sure about that?

Mr. Lilley: I am never sure of anything.

Mr. Skinner: I hope that that will be written down.

Mr. Lilley: Bearing in mind all the considerations which I have outlined, the Government believe that, on balance, 50 per cent. is right. As the new clause imposes a charge, we need a Ways and Means motion such as the one which is before the House.
The hon. Member for Berwick-upon-Tweed (Mr. Beith) was critical of the Government for imposing a tax and suggested that money should be diverted to employees, local authorities and others. Without a levy, it would be impossible to divert money to any specified beneficiaries, unless the hon. Gentleman proposes to do so by a thoroughly unparliamentary means such as extra-parliamentary plunder. I shall be grateful if he enlightens the House on that score.
The hon. Gentleman asked why we withdrew the ways Ways and Means motion earlier and suggested that the Government were having second thoughts and wished to alter it. We withdrew it because we wished hon. Members to be able to go home to bed after they had been debating other matters at great length. It seemed sensible to withdraw it and then to reintroduce it. The motion was tabled on Friday and copies of it were available in the Vote Office that morning. It was published on Saturday and it could have been taken home by hon. Members over the weekend.

Mr. Beith: If the House is to be asked to pass the motion, surely it must be on the basis that the Government have specific plans to channel the revenue to the good of the employees and communities concerned. On that basis, it might be worth inviting the House to approve it. It is

apparent, however, that the Government have no plans to do that. It is on that basis that I argue that it is wrong for the money to go to the central Exchequer.

Mr. Lilley: If the hon. Gentleman believes that the central Exchequer should never receive any money from taxation or levies, he will be hard pressed to finance the public expenditure plans he supports.
In the clauses we have spelt out that up to 3 per cent. of the shares can go to employees, that 50 per cent. will be retained, before being subject to capital gains tax, by the trust ports. That money will be reinvested in the ports and in assets that have lain idle and undeveloped because of the restrictions imposed on the operations by the trustee status of the ports. The money will therefore be channelled automatically into the local authority areas. The other 50 per cent. will be available to the Exchequer to put to the excellent use to which the Government put public expenditure.

Mr. Nicholas Brown: The Financial Secretary said that he is never sure about anything and, having followed him through most of the Committee on the Finance Bill, I cannot contradict him.
For the avoidance of doubt, it would be helpful to the House if I said that the Ways and Means resolution that we are discussing will enable the Government to introduce clauses into the Finance Bill tomorrow to bring in a new tax. You will know, Mr. Deputy Speaker, perhaps better than anyone in the House, that, in the normal way of things, the Finance Bill Committee is not allowed to put up taxes or introduce new ones. Our affairs are circumscribed by the resolutions passed in the House at the end of the debate on the Budget. To facilitate such an unusual course of events, the Government have come to the House, correctly in their terms, to get the money resolution and the Ways and Means resolution through.
The resolution does not serve any announced taxation policy—there was no word about it in the Budget speech or on Second Reading of the Finance Bill. It does not concern a new tax nor does it raise VAT or adjust the rates of income tax to secure better the revenues of the state. The resolution has been tagged on to the end of the Finance Bill to facilitate private legislation. The Labour party regards that as an abuse of the Finance Bill procedures. It is wrong that privatisation measures introduced through the private Bill procedure—technically they are not backed or opposed by the Government or the Opposition, but are subject to a free vote—should be facilitated by the Finance Bill.
The Labour party is opposed to privatisation measures, but that is not the matter under discussion tonight. We are discussing the share-out—the division of the money. The Government have argued that the trust ports belong not to the Government, but to the state. If that is so, surely it behoves the House to consider the mechanism by which the state offers those trust ports for sale. We are well aware that that mechanism is a private Bill passed through the House and the other place. The sale is governed by the decision of Parliament.
Who is in charge of the administration of the state? It is ludicrous for the Government to try to pretend that that is not a matter for them. For whom is it a matter if not for the Government? The Government must make the decision. If the state is offering the trust ports for sale and


the Government are in charge of the state, surely the Government keep the money realised from the sale. That, surely, is the logical position, although it is not the one that the Government are adopting.
The Government could adopt an alternative position. They could say that these institutions are somehow in limbo—not actually owned by the state and controlled by the Government but more distant. The analogy might be with a family company that is floating on the stock exchange and raising money in the same way as would any other private company that is going public. But surely, in these circumstances, the analogy should be with a company raising extra money that would accrue to the company—and to no one else, certainly not to the Government. Those seem to be alternatives: the Government cannot say that both are true, since they are mutually contradictory. So the Government will take half the money and the other half will remain with the port companies and be subject to taxation in the usual way.
If the proposals are passed tomorrow, the tax obligation placed on the new limited companies will be the minimum 50 per cent., instead of the maximum.

Mr. Cryer: My hon. Friend will bear it in mind that, in the new clauses tabled for debate by the Finance Bill Committee, the Government will take powers, subject to resolution of the House, to alter that percentage to any that they deem suitable. Fifty per cent. is only an assumption, subject to alteration at the whim of the Government.

Mr. Brown: We can go on only what the Government have told us of their intentions so far, but my hon. Friend is quite right. The hon. Member for Berwick-upon-Tweed (Mr. Beith) made a similar point, and he could have gone on to say that the tax treatment of the proceeds involved in this operation is bound to affect the share price. As people consider what they will pay for the Clyde or Tees and Hartlepool port authorities—we have not even agreed to pass the privatisation legislation in respect of the latter—they will inquire about the tax treatment of the institutions that they are buying. If a large amount of the proceeds revert to the Government, the value of the shares will fall; and if the whole proceeds stay with the company as if it were a private company going public, presumably the value of the shares will rise.
The privatisation process is highly unlikely to help Clyde, Tees and Hartlepool or any of the other 50 small trust ports that may end up in the hands of private capital. The private investment will come from all over the country. If there are profits—especially short-term profits—to be made from the privatisation, those profits will be dispersed all over the country, not retained as they should be, in the region in which they originated. Were successor public authorities to be created, we could ensure that the profits were retained locally.
My hon. Friend the Member for Cunninghame, North (Mr. Wilson), in the debate on the Clyde port authority, mentioned the public duties placed on the port authorities—to dredge rivers for river users, to maintain lighthouses—which thereby incur expenditure that does not necessarily generate a return. How will such duties sit alongside private sector ownership? Unhappily, I suggest. In the previous debate the Government did not say what

provision they intended to cover these matters. I suspect that the Financial Secretary will say nothing on the subject tonight, but we shall press him on it tomorrow.

Mr. Martin Redmond: My hon. Friend makes an interesting point. Why have not the Government written that into the Bill? Obviously, they do not want liability to fall upon the new privatised ports and harbours—or whatever the Financial Secretary wants to call them. If liability does not fall on the privatised companies, where does it fall, if not upon the public purse? The poor old taxpayer may have to continue to pick up the bill for performing a duty that should rightly belong to the new privatised industry.

Mr. Brown: I share my hon. Friend's fears. Probably it would work like this: the newly privatised port authorities, which will command a monopoly when running the facilities of the port or harbour of which they are in charge, will say to the users, "The cost of dredging is this. If you want it done to a certain depth, you will each pay your share, and if you object to that, we won't do it." The days when the river was dredged for them, as a subsidy to industry along the river, will be over. The same may even be true of the maintenance of lighthouses, which people's lives depend on. The privatised port authority will say to users who require the lighthouse to be there, "You will pay the economic cost or it will not be maintained."
I remind the House that we are talking not merely about assets that pertain to the operation of a port authority—there is much more to it. The port authorities own assets that far outstrip the narrow function of running a port. Indeed, one of the arguments for privatisation is that full and proper economic use of those assets cannot be made under the current trust status, which relates solely to port operation. A limited company, a series of limited companies, or an owning company and another company that will run the port separately—allowing the owning company to get on with other economic activities—are required. In other words, they will get on with the exploitation of surplus land, because there certainly is surplus land in many port authorities.
Tees and Hartlepool port authority, as my hon. Friend the Member for Middlesbrough (Mr. Bell) knows, said in its notes of evidence that it is aware that
The current members of the Port Authority at the time when the Act is implemented, will be responsible for setting up the companies and will of course constitute the Trust, which will be responsible for the sale.
The current members have said that the Bill will enable the business to 'have scope to develop outside the estuary, both elsewhere in the UK and in Europe, and both in the provision of port facilities and in other distribution activities.'
The current members also said again in a press statement, issued when the Bill was announced:—' The authority is determined that broadening its business scope will take place without diminishing its commitment to maintain, develop and expand the ports of Tees and Hartlepool and that direction of its activities will remain on Teesside so as to ensure that the area shares to the maximum in the benefit that will accrue"'—
I emphasise this—
from the development of its business on a broader scale."'
In other words, private status and expansion are intended, which, as my hon. Friends the Members for Jarrow (Mr. Dixon) and for Middlesbrough would be quick to point out, is bound to be facilitated by the existence of urban development corporations in the areas that many of the port trusts under consideration occupy. State money for economic development sits alongside new limited


companies that have trading in spheres other than narrow port operations as a stated objective. The opportunity to make substantial profits on real estate speculation is considerable.

Mr. Cryer: I draw my hon. Friend's attention to the Exmouth Docks Bill. Exmouth is a relatively small port, and it has been closed illegally. The authority applied to the House for permission to close it, but has done so without waiting for that. Exmouth's function as a harbour has been neglected, to the detriment of the immediate hinterland, because the directors want to develop surplus land for a marina and associated housing. That area has lost a valuable transport facility.

Mr. Brown: As a Member of Parliament for the city of Newcastle upon Tyne, I am not unfamiliar with such scams. I am grateful to my hon. Friend for drawing my attention to one in another part of the country. The opportunities—and my hon. Friend gives a stark example—are considerable. I and other hon. Members must challenge the wisdom and the equity of what the Government are doing. If there is a need for a change in status for the port authorities that provide important public services, surely we should look for successor institutions in the public sector. Such institutions are quite capable of taking care of economic development functions, and of doing so in such a way that they are accountable to the local community. The social desirability and the profits of such activities are matters for the local community and not for people who happen to end up as owners of the new private sector institutions, perhaps because of their position prior to privatisation. Many people have been put in influential positions prior to privatisation by no other person than the Secretary of State for Transport, who has charge of such appointments.
The Government did not announce the new tax in the Budget. They did not announce it on Second Reading of the Finance Bill. Indeed, their first reference to the fact that they might take a share in the proceeds of the sale, other than through normal taxation—to which my hon. Friend the Member for Middlesbrough referred—was in a ministerial response on Second Reading of the Clyde Port Authority Bill. That was when they announced the proposed 50 per cent. take. It was on the evening prior to the Committee stage of the Tees and Hartlepool Port Authority Bill.
It was clear from the answers given by the chief executive of the port authority at the Committee hearing that the level of take and its mechanism had been something of a shock. That view is underscored by the fact that the hon. Member for Isle of Wight (Mr. Field), who chaired the proceedings, tabled an amendment to the Finance Bill to reduce the percentage of the Government's take. That amendment has disappeared—[Interruption.] It has disappeared. I do not know what magic has brought that about.

Mr. Beith: The answer is simple—the Government withdrew their clause, thereby sweeping away amendments that had been tabled to it. They then retabled the clause a couple of days later.

Mr. Brown: In those circumstances, surely it would be possible also to retable the amendment—but it has not reappeared. It is probably too late as the matter is to be discussed tomorrow.
It is important that the House realises that we are considering a Ways and Means motion that will facilitate a new levy. It is not connected with corporation tax or capital gains tax. Technically, it is difficult to understand, although the objectives are clear. The levy is payable only on a disposal of securities to what is referred to as a successor company from what is referred to as a relevant port authority. In other words, the latter can be only a harbour authority that is not already a company and is not a local authority. I am assuming that if it is a company owned by the Government or local authorities, all the proceeds of privatisation flow into the right pockets anyway, and if it is a privately owned company, it could not be privatised again.
The levy is designed to apply where a non-company harbour authority transfers its trade, an undertaking by Act of Parliament, to a subsidiary in exchange for shares. In other words, the circumstances that we are expecting to pertain following the passage of the private Bill on the Clyde port trust, and that on the Tees and Hartlepool port trust, if those Bills are passed, will apply if the companies then sell the shares. The Government may say that the levy applies only where the shares are sold by the relevant port authority or its creature. The taxation of such schemes is, by necessity, complex. It will depend on the corporation tax statutes, the harbour authority, the terms of the private Act, and the scheme for transferring the trade. However, at first sight, the levy is a second non-offsetable charge to tax. Although that may not be what the Government intend, what has been published shows that that is how the scheme will operate in practice.

Mr. Roger Moate: I trust that the hon. Gentleman will tell us what his proposals are. Assuming that privatisation goes ahead, what does he think should happen to the proceeds? Is he saying that 100 per cent. should remain with the new owners, or that 100 per cent. should revert to the taxpayer, or what?

Mr. Brown: I thought that I had dealt with that point. The Labour party's view is that if there is a need to restructure the Clyde or the Tees and Hartlepool trust port, there should be a successor—more modern, and perhaps more versatile, but a public authority in the public domain, representing the interests in the local community, and carrying on what are essentially public functions. The Labour party is voting against the private Bills—a fact that the hon. Gentleman has probably noticed. For the hon. Gentleman to say that, while we disagree with it, it has now been done and we should say what the tax treatment should be, is disingenuous. We do not think that it should have been done in the first place. Therefore, I see no point in answering the hon. Gentleman's question. I have made it clear that we believe that it should not have been done in the first place. It is like saying to somebody, "You don't believe in capital punishment, but if people have to be put to death, should they be hung or gassed?" It should not be done at all.

Mr. Deputy Speaker: Order. We are getting away from the resolution before the House. I hope that we shall get back to it.

Mr. Brown: I have done my best to answer the question in my terms. I am sorry that I will not come on to the hon. Gentleman's ground, and debate the details of a matter that is wholly for the Government, not the Opposition. We


do not agree with it, so we shall not join the argument about how the spoils should be shared out. There should not be any spoils. The money should remain with the local community, in a successor public authority.

Mr. Moate: This is an important matter, not just for the ports that we are discussing at the moment but for many other trust ports. Assuming that privatisation takes place—and the hon. Gentleman volunteered that that is not what we are debating—does not it behove the hon. Gentleman to make serious proposals about what should happen to the proceeds? Have not the Government come forward with an acceptable—

Mr. Deputy Speaker: Order. I hope that we shall not pursue that line of debate, because I should have to rule it out of order. I hope that the House will confine itself to the motion.

Mr. Brown: I have done my best with the question. If it would help the hon. Gentleman, I can tell him that we shall be voting against the Government's proposals tomorrow, and if Tory Members on the Committee considering the Finance Bill wish to oppose them as well, perhaps because they think that the proposed tax is too high or too low—both lines are open to them—all that they have to do is to shout no when we do. I wonder how many Tory Members will do that. The hon. Gentleman does not have to persuade me to vote against the Government; he has to convince his hon. Friends and I suspect that that is a different matter.
As I understand the proposals—I know that we shall be going into more detail tomorrow, so I shall not detain the House much longer—the levy can be deducted in calculating any gain made on the sale of the shares that attract the levy. That suggests that quite large gains on the sale of those shares are expected. That brings me back to what we consider to be at the heart of the debate. Quite substantial sums—£60 million in the Hartlepool and Tees port trust and a slightly smaller sum, in the mid-£50 million range, in the Clyde port trust—are at stake. The House should take seriously the treatment of that money. We consider that the Government should establish successor public authorities that will serve the public interest rather than bolt through the private Bill procedure and, through very tacky use of the Finance Bill, facilitate a measure that will be in the long-term disinterest of the citizens whom the port authorities serve and the people of our country.

Mr. Tim Devlin: I shall not detain the House long as I know that my hon. Friends wish to get on with the debate as quickly as possible, but I wish to make one important point.
The levy is a new tax on a completely new procedure for taking trust ports out of the public sector and putting them into the private sector. One could argue convincingly on both sides of the question as to whether such a levy should be made and whether it should be 100 per cent. or nil.
Two particular points concern me as a constituency Member of Parliament near one of the ports currently undergoing privatisation. First, as I understand it, the amendments to be introduced in the Finance Bill Committee tomorrow attach the levy not to the proceeds

of sale but to the market value of shares. Therefore, if the ports go to the market and the market gives them a certain price which is taken to be the proceeds, they will face the levy not on the proceeds gained from the sale but on what the shares might have realised if they had been sold in the City of London.
The plan in regard to Teessideis that the port will sell its shares to local pension funds and other interested bodies so as to keep the equity and the interest in the local community.

Dr. Norman A. Godman: Will the hon. Gentleman give way?

Mr. Devlin: I will give way in a moment, but I wish to finish this important point.
If the proposal goes through as currently drafted, instead of the shares being offered to the people and the pension funds of Teesside, they will be offered to the City. That is why I reject all the assurances given by the promoters of the Bill when it came before the House some time ago.
Secondly, the levy is not the end of the taxing arrangements for privatisation. The 50 per cent. levy is a straight abstraction of funds from the privatisation process. In addition, there will be a further rate of corporation tax of the order of 30 per cent. That means that approximately 65 per cent. of the possible market value of the shares will be abstracted from the flotation. Indeed, it is possible that more than 100 per cent. of the proceeds of the sale will be abstracted. It will thus have failed completely and there will be no reward for the brave local authority proposing the plan and no incentive for any other public port to go through the same process. I am profoundly disturbed by that.
I understand that the Liberals tabled some amendments to the original proposals but dropped them when the draft clause was withdrawn. As the new clause has been introduced in a slightly different form, the amendments would not normally attach to it, but it has been confirmed that the Liberals' amendments will attach to it tomorrow. The amendments tabled by my hon. Friend the Member for Isle of Wight (Mr. Field) and further amendments being tabled by Conservative Members will attach to it when it is considered tomorrow.
I am happy to vote for the concept of a levy on disposals for the purposes of the motion, but I am not in favour of a levy on the market value of the shares rather than on the proceeds of the sale, thus making privatisation a meaningless process. I ask my hon. Friend the Minister to consider that closely because, unfortunately, I shall not have the pleasure of joining him in Committee tomorrow morning.

Dr. Godman: The concern that the hon. Gentleman expressed about the need to retain the ownership and management of a port authority in the locality is shared equally by Clydeside Members in relation to the privatisation of the Clyde port authority.

Mr. Devlin: I am grateful to the hon. Gentleman, because the hon. Member for Newcastle upon Tyne, East (Mr. Brown) did not satisfactorily answer the question about how much of the proceeds should be retained by the state. It is no answer for him to say that we should not undergo this process. He must face the question of the tax treatment. The only ideologically pure position for the


Labour party is to abstract 100 per cent. of the proceeds of sale. That is what the hon. Member for Newcastle upon Tyne, East should have had the courage to say.

Mr. Nicholas Brown: Will the hon. Gentleman give way?

Mr. Devlin: I will just finish this point. The hon. Gentleman will not say that because he is a north-eastern Member of Parliament and does not want to upset the voting public around the ports on the Clyde and Teesside.

Mr. Brown: That is all very well, but Newcastle ceased to be a port some time ago. With a majority of 12,500—somewhat larger than the hon. Gentleman's—I do not have to kowtow to any interest group in my constituency, and I certainly would not do so. The point that the Labour party is making is that we do not have to say how we would deal with the proceeds of the sale of these institutions because we would not sell them at all—we would create successor authorities in the public sphere and in the public interest, something that the Conservative party seems willing to overlook.

Mr. Devlin: As the Labour party does not have a view on this matter, it will obviously sit mute in Committee tomorrow and not oppose the Government or say anything further, allowing hon. Members who do not have difficulties about dealing with the tax treatment of this problem to deal with it among themselves. No doubt the hon. Gentleman and his party will sit there and say nothing.

Mr. Ian McCartney: I am a member of the Finance Bill Committee and chairperson of the Transport and General Workers Union parliamentary group. Under the private Bill procedure, our union submitted a great deal of evidence about the effects of the levy and proposals for the surplus income realised by the sale of the assets.
The motion is a Government attempt to provide a back-up to the proposals in new clauses 67 to 72 of the Finance Bill, which will be considered tomorrow. The Government want to provide a new, confiscatory tax on the assets realised from the privatisation of the Clyde port authority, the Tees and Hartlepool port authority and other authorities to be privatised later. The new clauses will allow the Government to implement their announcement that they intend to take 50 per cent. of the proceeds of the privatisation of any trust port.
The British Ports Federation urged the Government to introduce general enabling legislation to allow trust ports to go down the privatisation road, if they so decide. Through lack of public parliamentary time, the Government have not been able to provide the necessary facilities to allow the companies to go down that route. They have offered the private Bill procedure, and the Clyde port authority and the Tees and Hartlepool port authority are following it.
The Government's actions in the motion and the new clauses are not a million miles away from the procedures applying to the disposal of assets by local authorities. New clause 67 states:
—(1) A levy shall be chargeable on the disposal of securities of a company which is, or has control of, a successor company to a relevant port authority if the disposal is made by—

(a) the relevant port authority,

(b) a company under the control of the relevant port authority, or
(c) a person constituted under a private Act the Bill for which was promoted by the relevant port authority."

Only 20 per cent. of the income derived from the capital receipts gained by a local authority in the disposal of its assets can remain with the authority for the use of the community, while the remainder goes to the Treasury. Under the motion, at least 50 per cent. of the capital receipts accrued from privatisation goes to the Treasury and will not be retained by the successor company for use in developing the port or in assisting the community through a development agency, the local authority or a similar body. The successor company will be prevented from using the money in the way that it would prefer.
The Government's 50 per cent. proposal could have been influenced by arguments in opposition during the passage of the Clyde Port Authority Bill and the Tees and Hartlepool Port Authority Bill. Those who presented petitions and gave evidence to the Committees made it clear that, if privatisation went ahead, the capital receipts accruing from the sale should remain with the successor companies and within the local communities, for the development of port resources and facilities and to utilise joint projects within the ports and in the surrounding hinterland. The new clause would remove that opportunity.
Hon. Members on both sides of the House put aside their objections to the original privatisation proposals on the ground that, as the hon. Member for Stockton, South (Mr. Devlin) said, assurances had been given that resources accruing from the sales would be ploughed back into the development of the infrastructure in the local communities from which the assets had been realised. Most of the ports are located in areas where resources are required to develop alternative forms of employment and infrastructure, so one can understand the opposition to the Government's proposals. Under new clause 67, millions of pounds' worth of assets accruing from the sales may be siphoned off to the Exchequer rather than being used by the successor company or by that company in conjunction with the local community.
When the British Transport Docks Board was privatised and became Associated British Ports, the equity value of the company was way below what the Government had estimated before the flotation price was set. The assets were completely undervalued and initially the company did not realise its true value on the open market. Under the Ways and Means resolution and new clause 67, both the Clyde ports authority and the Tees and Hartlepool ports authority may be sold on the open market at considerably less than their true market value. If their assets are undervalued, the resources coming back into the successor companies will be less than one might have expected. At the same time, the authorities will have a minimum of 50 per cent. of their supposed assets taken by the Treasury. That will undermine the long-term viability of the company and its ability to raise capital to develop the port facilities which the Government so readily suggested needed to be privatised so as to raise the finance to develop future opportunities in the ports. Those resources will be withdrawn from the ports, first by undervaluation on flotation and, secondly, by the imposition of a confiscatory tax after the sale.

Dr. Godman: If new clause 67 is successful, it is likely that the port authority will become more of a property company and will divorce itself from its maritime industrial activities. That will damage many maritime communities on the Clyde.

Mr. McCartney: From my own personal background, history and heritage, I know a great deal about that question. My father was the hon. Member for Clydebank and Milngavie for a number of years and I was brought up in a Clyde port community. No one seems to realise that the current capability of the assets of the Clyde port authority are to be counted not in tens of millions or thousands of millions of pounds. We are talking about hundreds of billions of pounds' worth of public assets developed over a number of years being floated off on privatisation. Moreover, at least 50 per cent. of the resources from those assets will not be ploughed back into the Clyde port communities, which are suffering from under-investment and chronic unemployment and which have been devastated in the past decade by the withdrawal of shipbuilding and associated industries. The resources accrued from those assets should be used on the Clyde, but instead they will be withdrawn from the CPA area and used by the Government, no doubt to provide tax cuts for the well-off in the run-up to the next general election.
It is vitally important that we relate this motion to the new clauses that the Government intend to move in Committee tomorrow. When we consider what the Government intend to do in terms of confiscating huge public resources for the Treasury, we believe that we have every right to question the Government's right to raise that kind of taxation levy.

Mr. Bell: My hon. Friend is making an important contribution to the debate. Does he accept what the Financial Secretary to the Treasury said earlier—that the Government are simply confiscating the funds, that they are not earmarking them for any special purpose but simply putting them into the contingency fund where they will be absorbed without benefiting the communities involved?

Mr. McCartney: My hon. Friend is right. The Government are confiscating the resources. They are not ring-fencing them for the development of port facilities for 1992 and beyond and the pressures that will come from our European competitors in Rotterdam and the North sea ports from Germany to Portugal. The Government are not trying to use the resources to develop port facilities and the hinterland to face the situation after deregulation in 1992.
The Government have given no indication that they will use the resources for retraining in the ports. Tens of thousands of jobs have been lost in the past decade. Indeed, in the past 12 months thousands of jobs have been lost in port communities on the western and eastern seaboards of Britain. The Government have not sought to ring-fence the resources for training and retraining, nor the resources being ring-fenced to pay for a high-speed rail link to the channel tunnel to improve Britain's transport infrastructure. It is clear that the resources are to be cynically siphoned off by the Government for whatever short-term financial gain they think they can get in relation to the electorate.
Worst of all, the communities concerned will lose those resources for ever. The opportunity to improve the

transport infrastructure to and between ports in Britain will also be lost for at least another decade. The Government are not just being negligent—in industrial and taxation terms they are being criminally negligent as they try to implement new clauses 67 to 72 in Committee tomorrow.
My hon. Friends will return constantly to this point and question the Government's right to take 50 per cent. of an artificial value of a port asset, even taking into account the capital gains liability, to create an effective deterrent to predators subsequent to the sale of the port and its assets.
In evidence to the Committee on the Tees and Hartlepool Ports Authority Bill, the Transport and General Workers Union said:
If port authorities wish to go private, then the assets in the port should be vested in a new statutory body made up of representatives in the port area and the surrounding community, comprising employees, local residents, users of the port facilities, shipping interests, the port authority, the regional and local county council and, where one exists, a regional development corporation.
That would seem to me—and, I assume, to Conservative Members interested in the development of their local communities and employment opportunities in those communities—to be a reasonable proposal. If privatisation is to take place, the benefits should be spread throughout the community and the resources from the privatisation should be used to develop the community's infrastructure.
The proposal seems not dissimilar to the Government's argument on the creation of urban development corporations. They implied that UDCs would have a job to do in conjunction with local business communities, local trade unions, local authorities, and so on. When it comes to privatisation, ports will be disembowelled at the point of sale, and 50 per cent. of their assets will be dragged from them and the community, placed in the hands of the Exchequer and used for projects other than the development of the local economy. That runs counter to the Government's strategy of regenerating communities in the north-west, the north-east and other parts of Britain, such as Scotland, where because of the historical run-down of ports there is massive unemployment and much land dereliction.

Mr. Bell: My hon. Friend will have noted the statement by the Financial Secretary to the Treasury that the ports are owned by the state and are not trust ports, as that was originally defined in relation to 50 or so ports. Is it not a fact that when they were trust ports they were held in trust for the local communities? Is not that the point that we are trying to convey to the Financial Secretary? Being trust ports, in the interests of local communities, the proceeds should be ring-fenced in the interests of local communities if there is to be privatisation.

Mr. McCartney: My hon. Friend is absolutely right. I do not have time to discuss the history of the development of trust ports, but they were set up to protect the interests of local communities. The subsequent development of ports had to relate to the needs of local communities. In most instances, whether they were large or small trust ports, there was a good working relationship between local communities, local authorities, chambers of commerce and other local institutions and the port for the development of programmes of activities to ensure the best use of those ports on behalf of the community and the local economy.

Mr. Cryer: Is it not also true that a successful and expanding port often means greatly increased volumes of traffic in the immediate area? Local communities have therefore carried the burden of a large amount of traffic congestion and noise, mainly from large lorries up to 38 tonnes, the maximum weight available because of port haulage. If the local community has to bear that burden, it might at least have some of the benefits arising from privatisation.

Mr. McCartney: I used to work for the Labour party in Kent, not 100 yd from the eastern docks of Dover. I know all too well the consequences of literally millions of tonnes of lorry movements a year to and from the port. In the mid-1970s, the local community argued for a levy at the port to take account of the environmental consequences for communities living near port facilities.
The argument about the sale and confiscation of resources to the national Exchequer rather than remaining in the community is partly a response to the need to provide additional investment to improve the environment in communities near port facilities. Improvements in areas of land dereliction, transport infrastructure, and so on are related to activities of roll-on/roll-off traffic to and from ports, and require capital investment and capital resources, which could come from the sale of the ports. The sales represent a huge financial bonanza for the Government, who will guarantee those resources to themselves at the expense of the local community.
In its evidence to the Committee examining the Tees and Hartlepool Port Authority Bill my union also said that a devolved structure which would involve the community with the successor company had an important physical asset. The union said:
The structure would ensure that the control of the port's assets would be securely retained in the community which had taken the major role in generating the port's assets, and because, generally speaking, ports are significant employment generators, investment in the port and its future development would have first claim on the use of its transferred assets when owned and controlled by a representative body of that kind.
That is not a revolutionary or unique statement, but a common sense approach to the development of community infrastructures when resources become available. Irrespective of their ideological support or opposition to the sale of public assets, all hon. Members should agree that the beneficiaries of such sales should be the community in which the sale takes place.

Mr. Bell: My hon. Friend touches on an important topic. About .£40.5 million is being taken out of the Tees and Hartlepool community and about £16.25 million is being taken out of the Clyde community. The figures may not be accurate, but money is being taken out by the Government rather than put in.

Mr. McCartney: The levy is rather like a big vacuum cleaner, sucking up resources placed on the market by a local company. There is double taxation because not only is there a 50 per cent. levy on the perceived capital value of the company but there is another tax rake-off. As the hon. Members for Stockton, South and for Berwick-upon-Tweed (Mr. Beith) have said, in practice the 50 per cent. tax climbs to a rate of 100 or 110 per cent. That is to be imposed by a Government who say that they are the Government of low taxation, who will remove taxation from the backs of business and allow it freedom to invest and develop in the community.
In reality, the Government cannot keep their greedy mitts off assets that have been built up in communities over more than a century. They see an opportunity to seize resources for party political purposes in the run-up to the general election. [Interruption.] I think that the hon. Member for Sherwood (Mr. Stewart) said, "Nonsense." I will give way if he wishes to contribute to the debate. My hon. Friends and I stayed for many hours last week to assist him in his forlorn campaign to prevent the import of thousands of tonnes of South African coal, although the hon. Gentleman's opposition to that had more to do with saving his seat than with anything else.

Mr. Andy Stewart: The hon. Gentleman should have been looking this way. I did not say "Nonsense".

Mr. McCartney: I apologise to the hon. Gentleman. The hon. Member for Dover (Mr. Shaw) is sitting behind the hon. Member for Sherwood. Is he asleep? The hon. Member for Dover is the sleaze factor of the Conservative party in the south-east.

Mr. Andy Stewart: He was bombed out of the Carlton Club last week.

Mr. McCartney: He will certainly be bombed out at the next election.
New clauses 67 to 72 are no more than a token gesture by the Government and a sop to reduce Opposition arguments against the privatisation of ports. We shall not fall for that. We start from the premise that, as a matter of principle, the ports should not be privatised. But if they are to be privatised, the resources from the sales must remain with the successor companies and the communities in which they operate. It is therefore vital that hon. Members on both sides who believe in the propriety of the House and its ability to resist manipulation by the Executive should reject the motion.

Mr. Cryer: Does my hon. Friend accept that manipulation of the House is exactly what the Tory Government have in mind? Even at this moment the Tory Whips are telephoning the sleepy brigade of the Tory majority to come in and support a closure. Not only are the Government driving the resolution through the House with inadequate information based on clauses not yet considered by the Standing Committee that is considering the Finance Bill but they are using their ruthless majority to drive it through the House.

Mr. McCartney: My hon. Friend is absolutely right. It is not the first time that we have been here late at night discussing legislation in which the Government are manipulating the procedures of the House for party political ends. They are continually manipulating the House. After 11 years in government they treat the House and its Members with utter contempt. As a relatively new Member of the House, I sometimes feel that the rights of Back-Bench Members, from whatever party, are cynically put aside for the purposes of the Executive to control business and the nature of the business. The Government treat the House as no more than a rubber stamp for their activities.

Mr. Bell: I am not sure whether my hon. Friend commented on the intervention of my hon. Friend the Member for Bradford, South (Mr. Cryer). Here we are dealing with an important debate which will affect the


future of our local communities and certainly of my constituents and those of my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman). Yet we face the possible closure of the debate.

Mr. Deputy Speaker: Order. Let us return to the motion before the House.

Mr. McCartney: I cannot comment on the closure of the debate but it will not be the first time that the Government or the Conservative party have sought to use the procedures of the House to close a debate in which Opposition Members wished to speak. They have also tried to keep the hon. Member for Sherwood quiet in his opposition to ports measures that have come before the House on previous occasions.

Mr. James Pawsey: I cannot understand a word the hon. Gentleman is saying.

Mr. McCartney: Does the hon. Gentleman wish me to give way to him because he cannot understand what I am saying?

Mr. Deputy Speaker: Order. Let us return to the motion before the House.

Mr. McCartney: I accept what you say, Mr. Deputy Speaker, but it is a bit rich when hon. Members who have been in the dungeons downstairs meander in here and criticise me from a sedentary position. Some Opposition Members have spent a considerable number of hours here and have invested their whole lives in port communities and the protection of those communities. We do not lightly take lessons from rum-filled Conservative Members. If they wish to speak, let them get up and do so, but I will not be put off by sedentary comments from them.
The position is clear. The Government are attempting to use this Ways and Means procedure to facilitate the privatisation of at least 50 trust ports in Britain. But in facilitating the privatisation—this is more sinister than the privatisation—they are gathering to themselves literally hundreds of millions of pounds of public assets which should remain in the community, to be used for the Government's own purposes and dissipated on their pet projects. The money will not be ploughed back into the community from which the resources came in the first place.
For those reasons, Opposition Members will divide the House at the end of the debate and oppose the Government's proposals, and in the Standing Committee tomorrow we shall oppose the Government in all their attempts to gather up and steal, Dick Turpin fashion, the resources that were deployed in communities.

Mr. Pawsey: Sit down.

Mr. McCartney: I am sitting down.

Mr. Stuart Bell: I am glad to be able to take up some of the remarks of my hon. Friend the Member for Makerfield (Mr. McCartney). He has great knowledge of the matters that we are discussing because of his Transport and General Workers Union background

and his personal experience. His contribution encapsulated a series of important arguments of which the House should not lose sight.
My hon. Friend the Member for Makerfield talked about confiscatory taxation and then advanced an equally sound argument when he referred to the undervaluation of Associated British Ports. The Government may have brought the resolution before the House—it deals with market values—because of that undervaluation. It is a subject that will be discussed tomorrow when the Finance Bill is discussed in Committee.
The Financial Secretary to the Treasury talked about the previous money resolution and the Ways and Means resolution that is before us in terms of retrospection and the privatisation of Associated British Ports. He talked earlier about the unfair advantage that would be given to the new ports if the proposed taxation were not to be applied. As I understand it, the taxation will not be retrospective to include ABP. Who is losing out in the new confiscatory taxation that my hon. Friend the Member for Makerfield described?
In a series of interventions in the speech of my hon. Friend the Member for Makerfield an effort was made by Opposition Members to draw attention to ring fencing and the sums that would be raised by the proposed taxation. The Financial Secretary mentioned under his breath when I made my first intervention that public expenditure was not beneficial to the community. It seemed that that response ended with a question mark. Public expenditure is beneficial to the community, and the Labour party is the party that seeks to increase public expenditure for the benefit of the community. The effect of the resolution will be to take money away from local communities.
My hon. Friend the Member for Makerfield compared the resolution with local government resolutions and referred especially to housing. He is right that only 20 per cent. of receipts of council housing sales are allowed to be used by the local community.

Mr. McCartney: There are land sales as well and other assets which local authorities have to dispose of from time to time. When the Conservative party came to power, 100 per cent. of capital receipts could be utilised by local authorities for other developments in the community as long as that was approved by the Department of the Environment. There has been a reduction to 20 per cent., and the Government—these rogues—take the rest of it.

Mr. Bell: I am grateful to my hon. Friend for his intervention. He has demonstrated once again his knowledge of the workings of local government. As he said earlier—I have made the same point—money is being taken from local communities and it is not being replaced. There is no specific public expenditure in the areas of Tees and Hartlepool that he and I represent as a result of the privatisation that we have been considering. I am reminded of the North sea oil asset sales that have taken place over the past 10 years. About £70,000 million have found their way into the funds of the nation without being ring fenced.

Mr. Deputy Speaker: Order. It would be helpful if we were to consider one industry at a time.

Mr. Bell: I am grateful to you, Mr. Deputy Speaker, for bringing me back to the subject of the debate.
The new clauses that will be considered in Committee tomorrow will not result in the ring fencing of the assets that will be subject to taxation. I am glad that the hon. Member for Stockton, South (Mr. Devlin), who spoke earlier, has remained in his place. I once congratulated him on a sensible statement that he made in Committee and he produced a leaflet which contained my response. He circulated in throughout his constituency to ensure that his electorate knew what I had said about him. Therefore, tonight, I shall not extend to him my congratulations on his declared intention not to support the Government should we divide the House.
The hon. Member for Stockton, South made an important reference to the value of the shares connected with the Tees and Hartlepool port. He said that the promoters had suggested that the port's assets would be sold to local pension funds among others. There is no guarantee about that in the Ways and Means resolution or in the private Bill.

Dr. Godman: In the absence of guarantees on the local pension funds and local shareholders, the present board of the Clyde port authority, all of whom live close to the river, may eventually be supplanted by people who have no commitment to the Clyde and its maritime industries.

Mr. Bell: That possibility is referred to in the Ways and Means resolution when it speaks of a levy on
 "companies which control such companies".
The Government anticipate that the control of the Clyde port authority and that of the Tees and Hartlepool authority will end up in the hands of multinational companies elsewhere or, as the hon. Member for Stockton, South said, on the stock exchange. Those ports will then be floated and taken over by outside people. No guarantee has been given about the ability of local pension funds and local citizens to purchase shares.
Earlier the Financial Secretary said that the shares will be sold to workers, but how does he know?

Mr. Lilley: Provision in the clauses allows for up to 3 per cent. of the shares to be sold to the workers without affecting the proceeds liable to levy.

Mr. Bell: I am grateful for that significant revelation—

Mr. Lilley: Up to 3 per cent. of the shares can be given to the workers without affecting the proceeds liable to levy.

Mr. Bell: That is an interesting correction.
We have no guarantee that any of the work force in Cleveland and the Tees and Hartlepool areas will be able to benefit from a purchase. It is clear from the new clauses that the Government intend to introduce, facilitated by the Ways and Means resolution, that directors of the Tees and Hartlepool port authority will be unable to help themselves to shares in the successor company without those shares being levied at the market value. I am not entirely sure whether that shows great confidence in the directors on the part of the Government. Is it anticipated that the directors will give themselves shares at less than the fair market value? The Government have certainly covered that possible eventuality.
The hon. Member for Stockport, South said that about 30 per cent. corporation tax would be levied on the value of the assets. I understand from the Minister that 35 per cent. corporation tax will be levied.

Mr. Devlin: Since I made my earlier statement, I have learnt that 25 per cent.—not 35 per cent.—corporation tax will be levied. Perhaps the Minister can confirm that later.

Mr. Bell: I am not entirely sure why corporation tax should be levied at that lower rate instead of at the rate of 35 per cent. mentioned by the Minister.
If the resolution is passed, followed by the new clauses in Committee, the Government will take £30 million of the £60 million assets of the Tees and Hartlepool authority. On 35 per cent. of the remaining £30 million, the Government will take another £10.5 million—

Mr. Devlin: The hon. Member is misconstruing the figures. We are talking about flotation and hence about the tax on the market value of the shares, not on the existing assets. That is an important distinction.

Mr. Bell: We have always been told that the assets are worth £58 million which will be converted into shares which will then be sold to pension funds, to the work force and to other interested parties as yet unknown. People on Teesside believe that the Government will take 50 per cent., which is almost £30 million. Assuming the figures given by the Financial Secretary tonight, £10.5 million more will be taken away, too. So, of assets worth £60 million, the Government will take £40.5 million. I am sure that, when launching their enterprise, the promoters of the Bill never guessed that that would happen.
Given that the Government will take £40.5 million of the £60 million, how many years does the Financial Secretary think will have to pass before the port's asset base returns to what it is today? How much profit will it have to make to restore the difference?

Mr. McCartney: To make up the shortfall, is it not more likely that the port will have to sell some assets which it does not need in the short term but which it might want to retain for development in the future? The port might have earmarked surplus land for such development, but it might be told to sell the land, which has a huge market value, for housing development and so on.

Mr. Bell: That is a valid point. There will have to be asset sales to make up the shortfall. So instead of privatisation giving Tees and Hartlepool control over its own destiny, it will lose control of it—and of its assets. That can only be to the disadvantage of the port. It will certainly make it more difficult for the port to develop as it should.
Tees and Hartlepool handles the third largest tonnage in the country; Clyde handles the 10th largest, and has a work force of about 350. It is profitable and does not rely on Government subsidies.
Earlier, the Financial Secretary said that privatising these ports would allow them to build on their capital bases. But we have discovered that 50 per cent., followed by 35 per cent., of that capital base will be taken away from them. The Minister said that this was a matter of judgment, and so it is, but it is strange that the Treasury can take 50 per cent. of the assets of a port authority on its privatisation—

Mr. Cryer: Does my hon. Friend accept that the Government were so eager to take the opportunity to plunder these ports that they got 172 Tory Members to vote on the private Bill earlier tonight, but that because they expected these motions to go through on the nod the


number of Tory Members has gone down to just over 100 and the Government are busy telephoning around the conglomeration of soon-to-be-discarded junior Ministers asking them to come in?

Mr. Deputy Speaker: Order. Let us get back to the motion.

Mr. Bell: I shall follow your counsel, Mr. Deputy Speaker, and I shall not follow my hon. Friend the Member for Bradford, South (Mr. Cryer) along that line.
I was interested in the statement made by the Financial Secretary to the Treasury that the trust ports belong to the state. He prayed in aid the High Court. I have no idea which judgment he wished to refer to. I am sure that, even as a financial rather than a transport Minister, he must know that the term "trust port" goes back many years—certainly back to the 1930s—and was used by the Rochdale committee, which examined the nature of trust ports and their development in the 1960s. For all those years, it has been understood that such ports are held in trust for the local community.

Mr. McCartney: Even if the Financial Secretary's predictions are correct, and the ports are owned by the state, that should not give it the right to asset-strip their resources. That is the sort of activity that goes on in Stalinist economies; it is not what one would expect from a western-style democracy.

Mr. Bell: The Financial Secretary's speech and my hon. Friend's intervention remind me of the Trustee Savings bank, which was mentioned earlier. Its assets were worth £1 billion and the Government decided not to take a single penny but allowed the £1 billion to go straight into the financial markets, into the City of London, out in more plastic cards and bigger take-over bids, with no significant benefit to the community, to the manufacturing sector or to the local community. Yet, when the Government see an opportunity to take £30 million from the Tees and Hartlepool port authority and a similar large sum from the Clyde port authority, they are there like a shot.
One can imagine why we are debating this resolution tonight. We know of the great difficulties that the Government have in finding £3.5 billion to make up for the errors and the foolishness of the poll tax provisions and further likely expenditure requirements next year. Some £30 million from Tees and Hartlepool is a useful adjunct to raising money for that purpose.
There are some 50 trust ports. Perhaps the Financial Secretary can give us some information on them. As a result of the Ways and Means resolution, at least £100 million will be taken out of local communities up and down the country. That is a significant sum of money which we should debate on the Floor of the House tonight.
The Financial Secretary made a series of points in justification of the resolution. Most of them were spurious, and I am sure that he will not mind my telling him so. He said that the Treasury would take a higher share and that he thought that that was to the taxpayer's benefit. He talked of a level playing field—an interesting concept that we hear about time and again. I heard an east German business man talking of level playing fields on the television only yesterday morning.
The Financial Secretary also talked of the unfair commercial advantage which he felt might go to the Tees and Hartlepool port authority or to the Clyde port authority. But I believe that Associated British Ports did not have to pay the 50 per cent. levy that is being imposed tonight. He also talked of a lower Exchequer share and of not penalising Tees and Hartlepool and the Clyde because of their privatisation.

Mr. Devlin: I urge the hon. Gentleman to draw his speech to a close. He is digging himself into a deep hole. He is drawing a comparison with Associated British Ports, but it paid 100 per cent., not 50 per cent. The robbery was worse.

Mr. Bell: I am aware of the adage of my right hon. Friend the Member for Leeds, East (Mr. Healey) that when in a hole, one should stop digging. If I am in a hole, I shall immediately throw out the shovel.
I am reciting the weaknesses in the arguments of the Financial Secretary when he sought to explain why 50 per cent. of the assets of the Tees and Hartlepool port authority will be taken away. He mentioned a 35 per cent. corporation tax. He was modest and sensible and I sympathised with him when he said that he was never sure of anything. I can well imagine that, in his position, that is a proper attitude to take.
The Financial Secretary said that, on balance, 50 per cent. was about the right figure. I shall explain later why I do not believe that that is a proper and valid figure. My hon. Friend the Member for Newcastle upon Tyne, East (Mr. Brown), who served with me on Newcastle city council, has grown in stature since he came to the House. He is handling the Opposition's case in Committee on the Finance Bill. He rightly said that there was not a word about this new taxation in the Budget or on Second Reading of the Finance Bill. He mentioned the abuse of the private Bill procedure, to which we have referred on several occasions.
The Financial Secretary said that privatisation of the Tees and Hartlepool and the Clyde port authorities was the wish of the companies. I must enlighten him. Until the former Secretary of State for Transport said that it was the Government's wish to take the privatisation route for the ports, the idea had never dawned upon the port authorities. It was the idea of the former Secretary of State for Transport, not the wish of the members of the boards.
The resolution is intended to clear the way for the Government to participate, if not in the sale of the century, certainly in the bargain of the century. The taking of £30 million of the assets of Tees and Hartlepool is nothing short of the Treasury getting its sticky fingers on our assets.

Mr. Humfrey Matins: Sit down.

Mr. Bell: The hon. Gentleman must be patient; I have not yet begun my main speech. We are here not only to hold the Government accountable, but to probe them and to elucidate a whole series of reports from the Financial Secretary to the Treasury. I shall patiently build upon my speech within the rules of order and under the guidance of Mr. Deputy Speaker.
We are witnessing the bargain of the century. The Treasury is getting its sticky fingers on £30 million of the assets of the Tees and Hartlepool port authority, which


has yet to be privatised, and an additional £70 million from other port authorities, including the Clyde port authority—which we debated earlier—and other trust ports when they move from trust status to the private domain.
I am sorry that the Minister of Aviation and Shipping, who was here earlier, is no longer in his place. He may be—

Mr. Tim Boswell: My hon. Friend is here.

Mr. Bell: The Minister has moved precipitately from the Front Bench to the Back Bench. He may be anticipating the events of 16 and 17 July. He may be one of those Ministers who needs to worry about his future, or—

Mr. Deputy Speaker: Order. We should get on with the debate about the motion.

Mr. Bell: —he may be in line for promotion.

Mr. Deputy Speaker: Order. The hon. Gentleman should address himself to the motion.

Mr. Bell: I am grateful for your guidance, Sir. I hope that the Minister can hold his breath long enough. According to the Minister, whom I am glad to see here, the Tees and Hartlepool port authority made a pre-tax profit of £9.2 million in 1988 on a turnover of £35.5 million. Whatever the differences that I may have with the authority, I regard that as a commendable record so commendable that the Government intend to modify their Finance Bill, through this resolution, to take a share of the spoils.
I trust that you will pardon me, Mr. Deputy Speaker, if tonight you hear a series of epithets, metaphors and possibly mixed metaphors to describe the Government's actions in relation to the Tees and Hartlepool and the Clyde port authorities. The English language is hard put to describe what has been variously called "barefaced robbery", "getting their grubby hands on the community's money"—a point made by my hon. Friend the Member for Makerfield—and "daylight robbery". Lawyers say that there is not much difference between "barefaced" and "daylight" robbery. They amount to one and the same thing. In this case, the robbery is both daylight and barefaced. It is an asset stripping exercise by the Treasury to deprive any successor company to the Tees and Hartlepool port authority of £30 million plus taxation.
What hope is there for the country when the asset strippers are alive and well not only among the conglomerates and the rip-off merchants but in the heart of the Treasury? Essentially, the Ways and Means resolution will enable the Government to incorporate into the Finance Bill new clauses 67 and 68. My hon. Friend the Member for Bradford, South has referred to them, but it is clear that if the motion is passed, those new clauses will be before the Committee tomorrow. I was intrigued by the fact that the amendments tabled by the hon. Member for Isle of Wight (Mr. Field) did not appear on the Amendment Paper, although the hon. Member for Stockton, South has told us that they will be by tomorrow. The proposal of the hon. Member for Isle of Wight would reduce the 50 per cent. to be taken by the Government to 40 per cent. That would be a small and interesting concession.
I hope that the Financial Secretary will tell us whether he will accept those amendments. We understand, and it has been confirmed on several occasions, that the new clauses to the Finance Bill will be tabled if the resolution is passed, and will be debated by the Committee tomorrow afternoon. If that is the case, I can only advise my hon. Friends who are serving on the Committee to block this money-grabbing exercise by the Treasury.
Earlier, the hon. Member for Faversham (Mr. Moate) asked us what the Opposition would do in a similar situation, with a similar resolution. He reminded me of the story of the general who asked Napoleon, "What would you do if you had the enemy to the left of you, the enemy to the right of you, the enemy to the front of you and the enemy to the back of you? How would you get out of that?". Napoleon replied, "I would not get into it." The Opposition would not be privatising the ports, nor having the House debate, at 1 o'clock in the morning, a money resolution that allows the Government to take 50 per cent. of the profit from the Tees and Hartlepool and other port authorities. Nor would we have a Financial Secretary trying to evade most of the points put to him.
One can sympathise with the Government in seeking to bring such resolutions before the House and for seeking to get their hands on every penny—or every new fivepenny piece—that is going. As we read in the newspapers, even the peace dividend will not be safe in their hands and will be used, along with the money raised by tonight's resolution, to cushion another disastrous round of poll tax payments in the next financial year. Every penny, every £30 million, every £100 million and every confiscatory piece of taxation counts.
We all know that in the short term the Ways and Means resolution is aimed at the proposed privatisation of the assets of the Tees and Hartlepool port authority. In the longer term it is also aimed at the assets of the Clyde port authority. Watching your expression with great attention, Mr. Deputy Speaker, I shall not lead the House into a debate on the merits or otherwise of the Government's insistence on using private Bills for public Bill purposes. As my hon. Friend the Member for Newcastle upon Tyne, East mentioned earlier, we are not here to debate the merits or otherwise of the privatisation. Conservative Members may aid and abet a willing Government to privatise our assets through the private Bill procedure, but that is a matter for them.
Even the Leader of the House has published a document on changes in private Bill procedures. We shall not go down that route either, but a glimpse at the reasoning behind the privatisation of the Tees and Hartlepool port authority will quickly explain why we are debating the Ways and Means resolution tonight.
I have one question for the Financial Secretary about Tees and Hartlepool. As the Treasury wishes to acquire 50 per cent. of its assets, does it really wish the privatised authority to compete with Associated British Ports and Felixstowe, which are already privatised? Why is the port of Tees and Hartlepool being penalised compared with other ports already in the private sector? The Financial Secretary gave a somewhat oblique response when he said that he did not want the Tees and Hartlepool port authority or the Clyde port authority to have an unfair advantage. That seems rather an odd way to make that point.
The Ways and Means resolution refers to the amounts of money that the Government will raise. The Government


seem to believe that they can pass the Ways and Means resolution and take 50 per cent. of the assets of Tees and Hartlepool because many years ago they made a grant to the Tees and Hartlepool. No such grant has been made since 1980. One of the first things that the Government did when they took office was to prevent any further grants being made to the Tees and Hartlepool.
Even the Minister for Aviation and Shipping had to accept on the Second Reading of the Tees and Hartlepool Port Authority Bill on 15 March:
Admittedly it is a long time since such grants were paid to the THPA, and the amounts were small".
One should pause there for a moment. I warned you, Mr. Deputy Speaker, about the number of metaphors that might fly your way this evening, and we have all heard the phrase, "From little acorns mighty oaks grow". It is quite remarkable that, following small grants 20 years ago to Tees and Hartlepool to facilitate the building of certain assets, the Government boldly assert to the House that they will take 50 per cent. of all assets of the Tees and Hartlepool port authority as a result of the Ways and Means resolution. The Minister continued:
But the grants were paid about 20 years ago towards investment projects in the port, and some of those assets are still in use."—[Official Report, 15 March 1990; Vol. 169, c. 749.]
It is strange that some of the assets are still in use. The Government are seeking to get not 50 per cent. of the value of those assets but 50 per cent. of all assets, which is remarkable.

Mr. Cryer: My hon. Friend will have noticed that the Minister did not touch on the allowable deductions from the 50 per cent. rate of levy. He included a long list contained in new clause 68, such as fees, commissions and remuneration paid for professional services. Given the huge sums that the Government have paid for professional services, does my hon. Friend agree that it should be more adequately defined?

Mr. Bell: I agree with my hon. Friend. I did not want to quote chapter and verse from the new clauses, but we have noticed the reticence of the Financial Secretary, who went so quickly through his notes that I could not keep up with him in my inimitable shorthand. I hope that Hansard had a better chance to note what he said.
The Ways and Means resolution will enable the Government not to levy on grants paid against specific investment projects or even specific assets. It will, however, entitle them to 50 per cent. of the assets of all investment projects, whether or not they were financed by the Government 20 years ago or during that period or later by the port authority.
Between 1964 and 1980, as a trust port, Tees and Hartlepool could borrow from the Government, but since 1980 it has had to raise its finances on the money markets. The resolution makes no distinction.
I do not want to upset my hon. Friend the Member for Wakefield (Mr. Hinchliffe). We had great difficulty in Committee in distinguishing whether he was the hon. Member for Hinchliffe or for Wakefield. If I may upset his sense of humour again, may I say that, rather like the mills of God, the Treasury grinds exceeding slow, but it grinds exceeding small, though with patience it stands waiting, with exactness grinds it all? For such small sums of money,

paid in investment grant so many years ago, the Treasury will gain a benefit—I should say a windfall—for the Consolidated Fund of £30 million from the Tees and Hartlepool. As I said earlier, about £100 million will flow from the other privatisation measures.
The Financial Secretary touched on that in his opening remarks. He talked about the taxpayer and the benefit to the taxpayer. Perhaps the taxpayer should be happy; perhaps the Treasury should be congratulated; perhaps it is all part of the Government's privatisation drive; perhaps the proceeds will now be considered as the proceeds of privatisation. The Financial Secretary nods his head. Is he saying that the money that goes into the Consolidated Fund as a result of this 50 per cent. levy is part of the proceeds of privatisation? Will it be so treated in the Treasury books? Will it appear in the forecasts in the Autumn Statement as part of the privatisation proceeds? What of a local community such as Teesside? What of my constituents of Middlesbrough? What of the constituents of my hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman)? What of the constituents of my hon. Friend the Member for Hartlepool (Mr. Leadbitter)? What of the constituents of the hon. Member for Stockton, South? We have seen the Clyde and the Tees and Hartlepool authorities grow. We have seen the goods going in and out. We look askance at 1992 and all that that means for the port. As my hon. Friend the Member for Makerfield asked, why cannot that money be retained by the Tees and Hartlepool port authority? It does not need to be privatised. Why cannot that money be made available for the whole community? Why do we need this motion?
We hear a great deal about ring fencing and the earmarking of grants, but by abandoning the motion and then abandoning the Tees and Hartlepool Port Authority Bill we would ensure that the port authority's assets did not disappear into the maw of the Consolidated Fund but would be available to the community as a direct and easily calculable benefit.
My hon. Friend the Member for Makerfield referred to the Opposed Private Bill Committee and told us the view of the Transport and General Workers Union. Why cannot the money be invested in better port facilities to meet the challenges of 1992? Why cannot the money be used to create useful work for the skilled work force on Teesside? Why cannot the money be used for the regeneration of Teesside, which would be a joy and pride to us all? In those circumstances, the motion would not even have to be debated.
The Minister for Aviation and Shipping is rather ubiquitous, but he is still on the Floor of the House. On 15 March 1990, when trying to explain himself to the House, he said:
There is a general rule that, when assets acquired or improved by a non-Exchequer body with the aid of Government grants are disposed of, an appropriate proportion of the proceeds should go to the Exchequer.
I submit that 50 per cent. is not an appropriate sum to be taken by the state. By any stretch of the imagination, 50 per cent. of the assets can hardly be described as appropriate.

Mr. McCartney: We are talking about 50 per cent. of the market value of the assets. The most iniquitous aspect of the proposal is that the perceived market value of the company's assets is not necessarily the sale price at flotation.

Mr. Bell: That is an important point. In response to an intervention, the Financial Secretary said that the expenses were those associated with valuations of what was or was not the market value.

Mr. Dennis Skinner: This seems to be an odd kind of privatisation scheme. Naturally the Government are hellbent on privatisation in many ways. I heard the exchange involving the Financial Secretary when reference was made to a substantial rake-off, which was said to be well over 50 per cent. in terms of taxes. On the basis of ex-Cabinet Ministers joining the board of privatised companies to get a big fat salary—

Mr. Deputy Speaker: Order.

Mr. Skinner: Hear me out, Mr. Deputy Speaker.

Mr. Deputy Speaker: Order. I shall not hear the hon. Member out if he is not in order. He seems to be going far from the motion.

Mr. Skinner: No, Mr. Deputy Speaker. The burden of the debate has been about the Government taking a rake-off from these companies in taxation and so on. It has been suggested that that could amount to well over 50 per cent., based on capital gains and the rest. We now know that one ex-Minister joins the board of most privatised companies. Clearly, the Financial Secretary has not considered the matter properly. If he is the bod who is to get a job on one of the privatised port authorities, he should bear in mind that there will not be enough money for him—certainly not enough money—

Mr. Deputy Speaker: Order. The hon. Gentleman has gone far enough. Mr. Bell.

Mr. Bell: I am grateful to my hon. Friend the Member for Bolsover (Mr. Skinner), although I suspect that the Financial Secretary has a political career ahead of him rather than a career on a board of directors. I am sure that he has great expectations as 17 July appears on the horizon.
Let me again refer to the Minister for Aviation and Shipping, who is so ubiquitous that I cannot see him. He has drifted from the Front Bench to the Back Benches or out of the Chamber altogether. Like the competent Minister he has become, the hon. Gentleman duly reached for an appropriate fig leaf to disguise what the Government were doing and to seek to give this Ways and Means resolution some semblance of dignity and decency. On 15 March, he said that the Public Accounts Committee rightly attached great importance to the principle that, where grant money has been given to a particular enterprise, the Treasury has a right to an appropriate return on the investment. It is the House rather than the Public Accounts Committee which is debating the resolution tonight, but I will wager with the Minister for Aviation and Shipping, when he comes back to the House, and even the Financial Secretary, deep in thought as he is, that the PAC has never said that it considers 50 per cent. of an asset value an appropriate return on any investment—never mind an investment of such small proportions made 20 years ago.

Mr. McCartney: We are not talking about 50 per cent. of the disposal price or 50 per cent. of the value of the orginal investment in terms of grant. We are talking about 50 per cent. of the market value of the assets disposed of.
That is considerably in excess of any minimal amount of grant provided 20 years ago. The Government are not getting a return on their capital; they are getting an excessive return on an asset in which they did not invest in the first place. It is called asset stripping.

Mr. Bell: I said earlier that the Government are asset stripping in a way that would make other asset strippers blush with shame.
My hon. Friend the Member for Bolsover referred to the Financial Secretary to the Treasury. There is a clear confusion between the Financial Secretary, who is responsible for financial matters, and the Secretary of State for Transport, who is responsible for transport, and I am trying to elicit the precise difference between the two with my references to the Minister for Aviation and Shipping.
As I said, the 50 per cent. taken by the Government as a result of the Ways and Means resolution may be described as extortionate; it can never be described as appropriate.
The Ways and Means resolution is part of a double sleight of hand by the Government. First, it ensures that the Tees and Hartlepool port authority will be privatised under a private, rather than a public, Bill. Secondly, it ensures that the Bill cannot be described as a hybrid Bill because the Government have tabled new clauses to the Finance Bill.
I pray in aid again not the logic of the situation, which speaks for itself, but the words of the Minister for Aviation and Shipping. The hon. Gentleman is probably right to have left the House as I do not know that my words will assist his career or the events that may take place on 17 July. On 15 March, he said:
If the Bill"—
the Tees and Hartlepool Port Authority Bill—
were amended to provide expressly for a share of the proceeds to go to the Exchequer, it would cease to be a private Bill. There would then be the problem of accommodating it within the Government's legislative programme, to which I have already referred."—[Official Report, 15 March 1990; Vol. 169, c. 749.]
The Minister confirmed to the House that here was a public Bill on a private Bill route which required the modification of the Finance Bill to take into account its financial provisions. If that is not a perversion of the procedures of this House, I do not know what is. 'The Minister is to be congratulated on his lucid honesty. There was nothing opaque about the Government's intention. It is simple straigthforward chicanery, and they have subverted the procedures of the House in this Ways and Means resolution tonight by treating a public Bill like a private Bill and a modified Finance Bill like a hybrid Bill.
My hon. Friend the Member for Greenock and Port Glasgow sat through the charade earlier this evening called the Third Reading of the Clyde Port Authority Bill. He will no doubt understand the points that I am making on behalf of his constituency.

Mr. Skinner: Have we gone into extra time yet?

Mr. Bell: Extra time is for penalties, and we will have to see whether the penalty taker is up to it.
Other trust ports might be tempted to take the privatisation route. The hon. Member for Stockton, South earlier made a valid intervention in the speech of the Financial Secretary to the Treasury when he referred to the Ways and Means resolution and the 50 per cent. of market


value that the Government will take and corporation tax of 35 per cent. on top of that. The hon. Member for Stockton, South wanted to know what incentive there would be for other ports to follow the privatisation route. Why should other ports follow that route and see the Government take their asset values by way of taxation through the impost or levy? Should they follow that route because of a vague element of competition among themselves so that they can invest in ports in Europe or buy our smaller ports in this country? Why should they follow the privatisation route once they know that the Government will take 50 per cent. of the money?
The former Secretary of State for Transport, the right hon. Member for Southend, West (Mr. Channon), did not hint when he proposed the privatisation of the ports through the private Bill route that that should be achieved in such a way that the Government should have 50 per cent. of the assets.

Mr. Nicholas Brown: I draw my hon. Friend's attention to the fact that that was not mentioned in the Budget speech or on Second Reading of the Finance Bill. The Government did not mention it when discussing private legislation and it was not mentioned when we were discussing public legislation either.

Mr. Bell: I am grateful to my hon. Friend for reminding me of that. We are considering a new tax. The Government are introducing in this Ways and Means resolution the second new tax in the past year. They have introduced the poll tax and they are now introducing this new tax on the assets of our ports.
At least some small service has been served by this resolution. The House is entitled to know whether on each privatisation of each trust port, whether through the private or public Bill route, we are to have similar resolutions before the House; or will the new clauses to the Finance Bill to which I have referred, hopefully suitably amended by the amounts tabled by the hon. Member for Isle of Wight, be repeated in Finance Bills in future? In short, are we debating a blanket resolution covering future privatisation of ports? I hope that the Financial Secretary to the Treasury will consider those matters when he replies.
I want to bring my comments to a close so that other hon. Members may make useful contributions to the debate. Teesside and its community will be worse off as a result of this motion if it is passed tonight. Those who work for the authority will not be heartened by the knowledge that the Government have an eye on the assets that they have built up over the years—assets not just of bricks and mortar, but of toil and sweat. The workers' investment in their workplace has been life long. They have been sadly and severely damaged by the abolition of the dock labour scheme. They will be further damaged by the privatisation of Tees and Hartlepool, and they will be undermined by this motion. I urge my hon. Friends to vote against the motion.

Mr. Bob Cryer: Hon. Members should examine the motion with great care. As occurred earlier, we have seen demonstrated, as lawyers say, beyond peradventure the way in which the Government have tried to deceive the House in how this legislative process is being

undertaken. It is accepted that this is a taxation measure. A Ways and Means resolution is a common requirement of a taxation measure. As was said in a useful outline of the position, the measure was not announced in any manifesto, the Finance Bill or the Budget. There has been an attempt to slip the measure through the back door.
Fortunately, due to the vigilance of the Opposition, the Government's ploy has been exposed. If we had depended on the Minister, we should have had virtually no information at all. Bit by bit, it was revealed that the basis of the resolution is a component not of the Finance Bill but of the new clauses that were tabled for discussion in Standing Committee E tomorrow. The Government assumed that the Committee would approve the new clauses. It is offensive and arrogant for the Government to make that assumption. When hon. Members are to consider a subject on the Whip the following week, how many hon. Members actually pick up copies of new clauses, tabled in relation to a Ways and Means resolution, to be dealt with in Committee the following week? Normally, hon. Members go to the Vote Office, as I did, and get hold of a copy of the Finance Bill. In the Finance Bill there is no information about the resolution. It is a monumental evasion of convention that hon. Members should have no information available.
I am grateful to Mr. Deputy Speaker for saying that we could discuss the new clauses. That is an important component of our debate, and must necessarily be so. In the ordinary course of events, it would be left to the Standing Committee, which would then report to the House on alterations to the Bill, including any new clauses. However, because of the special circumstances, we have perforce to refer to the new clauses.

Mr. Beith: The position is worse than the hon. Gentleman has described. If he had gone to the Vote Office on Friday morning and picked up a copy of the amendments then tabled, he would have found that no new clause of this nature had been tabled. If he had made further inquiries, he would have discovered that there had been one but that it had been withdrawn. Only if he had been in the Public Bill Office in the last moments of Friday would he have discovered that the Government rushed back to table the new clauses.

Mr. Cryer: I am grateful to the hon. Gentleman for that information. He is a member of Standing Committee E and has been taking an interest, as members of the Committee normally do. Only a tiny proportion of hon. Members are on a Standing Committee at any given time. Having a knowledge of proceedings on the Finance Bill, and knowing that the clauses were previously tabled but were withdrawn, the hon. Gentleman would naturally know more than the vast majority of hon. Members who are not on the Finance Bill Committee. The hon. Gentleman is right—it is a dodge to withdraw the new clauses and then to retable them at the very last minute on Friday. My original assertion, which the Minister disputed, that it would be extremely difficult for hon. Members to take the information home with them over the weekend is correct. Even hon. Members who were here until the last moment of Friday's sitting would have had difficulty in doing that.

Mr. Skinner: Is my hon. Friend saying that the Minister is lying?

Mr. Cryer: I would not go as far as that. I am saying that the Minister was certainly being economical with the truth when he maintained that hon. Members could get the information to enable them to debate the money resolution and the Ways and Means resolution, because that patently was not the case.
New clause 68 shows the purposes for which the levy is to be used. The Ways and Means resolution gives authority for the levy to be made and new clause 68 excludes certain expenditure from that levy. If the clause is accepted by the Committee and becomes part of the Finance Act, those will be statutory exclusions and for that reason, we must discuss them. According to new clause 68(3)(a), they are
fees, commissions or remuneration paid for professional services".
That is the first item, but there are three others.
It is alarming that in opening the debate the Minister did not touch on any of those items. It is encouraging that such expenditure will require statutory approval. In a recent Adjournment debate I raised the issue of the sale of skill centres. One of the scandals about that giveaway was that Deloitte Haskins and Sells received £500,000 in fees for professional services, which included marketing and valuation services. Subsection (3)(d) of new clause 68 deals precisely with that because it mentions
expenses reasonably incurred in ascertaining the market value of the securities disposed of.
That is exactly the area that was critically examined. I and many people thought that the fees paid for those professional services were excessive. The resolution in conjunction with new clause 68 encourages expenditure in such areas by giving statutory exemptions from payment of the levy. It includes costs of transfer and advertising.
I am amazed that the Minister did not mention the expenditure that the Government have in mind. For example, is it the lavish expenditure on professional services and advertising in which the Government have been engaged? Will they put down guidelines? The Government frequently do that in all sorts of areas. When they pass primary legislation—as in this case—they issue guidelines that become almost laws in themselves to, for example, the trust ports. They are simply the instructions of a Minister to a civil servant, or from a civil servant to a Minister to say yes to the provision of guidance on the amount of expenditure that can be incurred.
The levy is the specific provision in the resolution. There are penalties. The levy can be varied by the Minister by way of statutory instrument. That is in new clause 68. The Minister talks about the levy being 50 per cent. However, if the new clause is passed, it will be subject to the affirmative procedure for statutory instruments. That is better than the negative procedure.

Mr. Skinner: What is that?

Mr. Cryer: It is where one has to table a prayer in order simply to obtain time for a debate. The Minister and all hon. Members present know that in the affirmative procedure, unless hon. Members object—

Mr. Skinner: The Minister is asleep.

Mr. Cryer: Under the affirmative procedure, unless hon. Members object, the matter can be dealt with in what is called a merits committee.

Mr. Skinner: The Minister knows what happened to Lawson: he fell asleep and got sacked.

Mr. Cryer: Often few hon. Members turn up for discussions in merits committees—[Interruption.]

Mr. Deputy Speaker: Order. The hon. Member for Bolsover (Mr. Skinner) must not keep calling out from a sedentary position and interrupting his hon. Friend, and he knows that he must not.

Mr. Skinner: Will my hon. Friend give way?

Mr. Cryer: I give way to my hon. Friend the Member for Bolsover (Mr. Skinner).

Mr. Skinner: If Mr. Deputy Speaker will allow me. I was pointing out to my hon. Friend and others that the Minister had dropped to sleep two or three times during my hon. Friend's speech. I wondered whether my hon. Friend thought that it was right and proper that while he was making important points about taxation the Financial Secretary was dropping off. The Chancellor of the Exchequer dropped off to sleep and six months later he got the sack. I was being fair to the Minister. I was pointing out that he might follow in the same fashion. That is all that I was saying.

Mr. Cryer: I am grateful to my hon. Friend for making that point. I thought that that was the drift of the interchange that was taking place. I was alarmed to find the Minister dozing off in the middle of my speech when I was making important points. It is characteristic of the Government's arrogant behaviour towards the House. The Minister made a nominal speech. He read out his brief virtually word for word. He finished it in five or six minutes, packed up and expects the motion to go through the House on the nod. The Government have had a bit of a jolt tonight. We have been exercising the vigilance that an Opposition should exercise—

Mr. Neil Hamilton: I beg to move, That strangers do withdraw.

Notice being taken that strangers were present, MR. DEPUTY SPEAKER, pursuant to Standing Order No. 143 (Withdrawal of strangers from House), put forthwith the Question, That strangers do withdraw:—

The House proceeded to a Division—

Mr. McCartney: (seated and covered): On a point of order, Mr. Deputy Speaker. You did not call a Division. No Division was called.

Mr. Deputy Speaker: The hon. Gentleman was not listening.

The House having divided: Ayes 1, Noes 123.

Division No. 276]
[11.07 pm


AYES


Alexander, Richard
Chalker, Rt Hon Mrs Lynda


Allason, Rupert
Chapman, Sydney


Amess, David
Chope, Christopher


Arbuthnot, James
Clark, Dr Michael (Rochford)


Arnold, Jacques (Gravesham)
Coombs, Anthony (Wyre F'rest)


Batiste, Spencer
Coombs, Simon (Swindon)


Bellingham, Henry
Cran, James


Bennett, Nicholas (Pembroke)
Currie, Mrs Edwina


Boscawen, Hon Robert
Davies, Q. (Stamf'd &amp; Spald'g)


Boswell, Tim
Davis, David (Boothferry)


Bowis, John
Day, Stephen


Brandon-Bravo, Martin
Devlin, Tim


Brazier, Julian
Douglas-Hamilton, Lord James


Bright, Graham
Durant, Tony


Brown, Michael (Brigg &amp; Cl't's)
Fairbairn, Sir Nicholas


Browne, John (Winchester)
Fallon, Michael


Burt, Alistair
Fishburn, John Dudley


Carlisle, Kenneth (Lincoln)
Fookes, Dame Janet


Carrington, Matthew
Forsyth, Michael (Stirling)





Forth, Eric
Moate, Roger


Franks, Cecil
Montgomery, Sir Fergus


Freeman, Roger
Morris, M (N'hampton S)


Gale, Roger
Moss, Malcolm


Garel-Jones, Tristan
Neale, Gerrard


Gill, Christopher
Neubert, Michael


Glyn, Dr Sir Alan
Nicholson, David (Taunton)


Gow, Ian
Norris, Steve


Greenway, John (Ryedale)
Oppenheim, Phillip


Griffiths, Peter (Portsmouth N)
Paice, James


Ground, Patrick
Patnick, Irvine


Hague, William
Pawsey, James


Hamilton, Neil (Tatton)
Porter, David (Waveney)


Hanley, Jeremy
Price, Sir David


Hargreaves, A. (B'ham H'll Gr')
Raison, Rt Hon Timothy


Harris, David
Redwood, John


Hind, Kenneth
Renton, Rt Hon Tim


Hogg, Hon Douglas (Gr'th'm)
Rhodes James, Robert


Howard, Rt Hon Michael
Rowe, Andrew


Howarth, G. (Cannock &amp; B'wd)
Shaw, David (Dover)


Howe, Rt Hon Sir Geoffrey
Shepherd, Colin (Hereford)


Hughes, Robert G. (Harrow W)
Smith, Sir Dudley (Warwick)


Irvine, Michael
Stanbrook, Ivor


Jack, Michael
Stern, Michael


Janman, Tim
Stevens, Lewis


King, Roger (B'ham N'thfield)
Stewart, Allan (Eastwood)


Knapman, Roger
Stewart, Andy (Sherwood)


Knight, Greg (Derby North)
Stradling Thomas, Sir John


Knowles, Michael
Summerson, Hugo


Lawrence, Ivan
Taylor, John M (Solihull)


Lester, Jim (Broxtowe)
Thompson, D. (Calder Valley)


Lightbown, David
Thompson, Patrick (Norwich N)


Lilley, Peter
Thorne, Neil


Lyell, Rt Hon Sir Nicholas
Twinn, Dr Ian


Maclean, David
Walker, Bill (T'side North)


McLoughlin, Patrick
Widdecombe, Ann


Malins, Humfrey
Winterton, Mrs Ann


Marshall, Sir Michael (Arundel)
Winterton, Nicholas


Martin, David (Portsmouth S)
Wolfson, Mark


Maxwell-Hyslop, Robin



Mayhew, Rt Hon Sir Patrick
Tellers for the Ayes:


Miller, Sir Hal
Mr. Nicholas Baker and


Mitchell, Andrew (Gedling)
Mr. Timothy Wood.


Mitchell, Sir David





NOES


Barnes, Harry (Derbyshire NE)
Kirkwood, Archy


Beckett, Margaret
Lofthouse, Geoffrey


Beith, A. J.
McCartney, Ian


Bell, Stuart
McFall, John


Bermingham, Gerald
Mahon, Mrs Alice


Brown, Nicholas (Newcastle E)
Michie, Bill (Sheffield Heeley)


Campbell, Menzies (Fife NE)
Nellist, Dave


Carr, Michael
Powell, Ray (Ogmore)


Cryer, Bob
Skinner, Dennis


Dixon, Don
Steel, Rt Hon Sir David


Evans, John (St Helens N)
Taylor, Matthew (Truro)


Fyfe, Maria
Wallace, James


Godman, Dr Norman A.
Wareing, Robert N.


Griffiths, Nigel (Edinburgh S)



Haynes, Frank
Tellers for the Noes:


Hinchliffe, David
Mr. George Buckley and


Home Robertson, John
Mr. Martin Redmond.

Division No. 277]
[1.42 am


AYES


Ashby, David
Mr. Neil Hamilton and



Mr. Harry Bellingham.


Tellers for the Ayes:





NOES


Alexander, Richard
Bell, Stuart


Alison, Rt Hon Michael
Bendall, Vivian


Allason, Rupert
Bennett, Nicholas (Pembroke)


Amess, David
Boswell, Tim


Arbuthnot, James
Bowis, John


Arnold, Jacques (Gravesham)
Brandon-Bravo, Martin


Aspinwall, Jack
Brazier, Julian


Baker, Nicholas (Dorset N)
Bright, Graham


Barnes, Harry (Derbyshire NE)
Brown, Michael (Brigg &amp; Cl't's)


Batiste, Spencer
Browne, John (Winchester)


Beaumont-Dark, Anthony
Bruce, Ian (Dorset South)


Beith, A. J.
Budgen, Nicholas






Burt, Alistair
Knapman, Roger


Carlisle, Kenneth (Lincoln)
Knight, Greg (Derby North)


Carrington, Matthew
Knowles, Michael


Chalker, Rt Hon Mrs Lynda
Lennox-Boyd, Hon Mark


Chapman, Sydney
Lightbown, David


Chope, Christopher
Lilley, Peter


Clark, Dr Michael (Rochford)
Lofthouse, Geoffrey


Coombs, Anthony (Wyre F'rest)
Lord, Michael


Coombs, Simon (Swindon)
Lyell, Rt Hon Sir Nicholas


Cryer, Bob
McCartney, Ian


Currie, Mrs Edwina
Maclean, David


Davies, Q. (Stamf'd &amp; Spald'g)
McLoughlin, Patrick


Davis, David (Boothferry)
Malins, Humfrey


Day, Stephen
Martin, David (Portsmouth S)


Devlin, Tim
Maxwell-Hyslop, Robin


Dixon, Don
Mayhew, Rt Hon Sir Patrick


Douglas-Hamilton, Lord James
Mitchell, Andrew (Gedling)


Durant, Tony
Mitchell, Sir David


Fallon, Michael
Moate, Roger


Fookes, Dame Janet
Montgomery, Sir Fergus


Forsyth, Michael (Stirling)
Morrison, Sir Charles


Forth, Eric
Moss, Malcolm


Fox, Sir Marcus
Neubert, Michael


Franks, Cecil
Nicholson, David (Taunton)


Freeman, Roger
Norris, Steve


Gale, Roger
Oppenheim, Phillip


Garel-Jones, Tristan
Paice, James


Gill, Christopher
Patnick, Irvine


Glyn, Dr Sir Alan
Pawsey, James


Godman, Dr Norman A.
Redwood, John


Goodlad, Alastair
Renton, Rt Hon Tim


Greenway, John (Ryedale)
Rowe, Andrew


Ground, Patrick
Shaw, David (Dover)


Hague, William
Shepherd, Colin (Hereford)


Hampson, Dr Keith
Skinner, Dennis


Hanley, Jeremy
Smith, Tim (Beaconsfield)


Harris, David
Stern, Michael


Hayes, Jerry
Stevens, Lewis


Haynes, Frank
Stewart, Allan (Eastwood)


Hayward, Robert
Stewart, Andy (Sherwood)


Hinchliffe, David
Stradling Thomas, Sir John


Hind, Kenneth
Summerson, Hugo


Hogg, Hon Douglas (Gr'th'm)
Taylor, John M (Solihull)


Howard, Rt Hon Michael
Thompson, D. (Calder Valley)


Howarth, G. (Cannock &amp; B'wd)
Viggers, Peter


Howe, Rt Hon Sir Geoffrey
Widdecombe, Ann


Howell, Ralph (North Norfolk)
Wood, Timothy


Hughes, Robert G. (Harrow W)



Irvine, Michael
Tellers for the Noes:


Jack, Michael
Mr. Patrick Thompson and


Janman, Tim
Mr. James Cran.


King, Roger (B'ham N'thfield)

Question accordingly negatived.

The Parliamentary Secretary to the Treasury (Mr. Tim Renton): rose in his place and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 115, Noes 11.

Division No. 278]
[1.52 am


AYES


Alexander, Richard
Brandon-Bravo, Martin


Alison, Rt Hon Michael
Brazier, Julian


Allason, Rupert
Bright, Graham


Amess, David
Brown, Michael (Brigg &amp; Cl't's)


Arbuthnot, James
Browne, John (Winchester)


Arnold, Jacques (Gravesham)
Bruce, Ian (Dorset South)


Ashby, David
Budgen, Nicholas


Aspinwall, Jack
Burt, Alistair


Baker, Nicholas (Dorset N)
Carlisle, Kenneth (Lincoln)


Batiste, Spencer
Carrington, Matthew


Beaumont-Dark, Anthony
Chalker, Rt Hon Mrs Lynda


Bellingham, Henry
Chapman, Sydney


Bendall, Vivian
Chope, Christopher


Bennett, Nicholas (Pembroke)
Clark, Dr Michael (Rochford)


Boswell, Tim
Coombs, Anthony (Wyre F'rest)


Bowis, John
Coombs, Simon (Swindon)





Cran, James
Lilley, Peter


Currie, Mrs Edwina
Lord, Michael


Davies, Q. (Stamf'd &amp; Spald'g)
Lyell, Rt Hon Sir Nicholas


Davis, David (Boothferry)
Maclean, David


Day, Stephen
McLoughlin, Patrick


Devlin, Tim
Malins, Humfrey


Douglas-Hamilton, Lord James
Martin, David (Portsmouth S)


Durant, Tony
Maxwell-Hyslop, Robin


Fallon, Michael
Mayhew, Rt Hon Sir Patrick


Fookes, Dame Janet
Mitchell, Andrew (Gedling)


Forsyth, Michael (Stirling)
Mitchell, Sir David


Forth, Eric
Moate, Roger


Fox, Sir Marcus
Montgomery, Sir Fergus


Franks, Cecil
Morrison, Sir Charles


Freeman, Roger
Moss, Malcolm


Gale, Roger
Neubert, Michael


Garel-Jones, Tristan
Nicholson, David (Taunton)


Gill, Christopher
Norris, Steve


Glyn, Dr Sir Alan
Oppenheim, Phillip


Goodlad, Alastair
Paice, James


Greenway, John (Ryedale)
Pawsey, James


Ground, Patrick
Redwood, John


Hague, William
Renton, Rt Hon Tim


Hamilton, Neil (Tatton)
Rowe, Andrew


Hampson, Dr Keith
Shaw, David (Dover)


Hanley, Jeremy
Shepherd, Colin (Hereford)


Harris, David
Smith, Tim (Beaconsfield)


Hayes, Jerry
Stern, Michael


Hayward, Robert
Stevens, Lewis


Hind, Kenneth
Stewart, Allan (Eastwood)


Hogg, Hon Douglas (Gr'th'm)
Stewart, Andy (Sherwood)


Howard, Rt Hon Michael
Stradling Thomas, Sir John


Howarth, G. (Cannock &amp; B'wd)
Summerson, Hugo


Howe, Rt Hon Sir Geoffrey
Taylor, John M (Solihull)


Howell, Ralph (North Norfolk)
Thompson, D. (Calder Valley)


Hughes, Robert G. (Harrow W)
Thompson, Patrick (Norwich N)


Irvine, Michael
Viggers, Peter


Jack, Michael
Widdecombe, Ann


Janman, Tim
Wood, Timothy


King, Roger (B'ham N'thfield)



Knapman, Roger
Tellers for the Ayes:


Knowles, Michael
Mr. Irvine Patnick and


Lennox-Boyd, Hon Mark
Mr. Greg Knight.


Lightbown, David

Question accordingly agreed to.

Question put accordingly:—

The House divided: Ayes 113, Noes 11.

Division No. 278]
[1.52 am


AYES


Alexander, Richard
Brandon-Bravo, Martin


Alison, Rt Hon Michael
Brazier, Julian


Allason, Rupert
Bright, Graham


Amess, David
Brown, Michael (Brigg &amp; Cl't's)


Arbuthnot, James
Browne, John (Winchester)


Arnold, Jacques (Gravesham)
Bruce, Ian (Dorset South)


Ashby, David
Budgen, Nicholas


Aspinwall, Jack
Burt, Alistair


Baker, Nicholas (Dorset N)
Carlisle, Kenneth (Lincoln)


Batiste, Spencer
Carrington, Matthew


Beaumont-Dark, Anthony
Chalker, Rt Hon Mrs Lynda


Bellingham, Henry
Chapman, Sydney


Bendall, Vivian
Chope, Christopher


Bennett, Nicholas (Pembroke)
Clark, Dr Michael (Rochford)


Boswell, Tim
Coombs, Anthony (Wyre F'rest)


Bowis, John
Coombs, Simon (Swindon)





Cran, James
Lilley, Peter


Currie, Mrs Edwina
Lord, Michael


Davies, Q. (Stamf'd &amp; Spald'g)
Lyell, Rt Hon Sir Nicholas


Davis, David (Boothferry)
Maclean, David


Day, Stephen
McLoughlin, Patrick


Devlin, Tim
Malins, Humfrey


Douglas-Hamilton, Lord James
Martin, David (Portsmouth S)


Durant, Tony
Maxwell-Hyslop, Robin


Fallon, Michael
Mayhew, Rt Hon Sir Patrick


Fookes, Dame Janet
Mitchell, Andrew (Gedling)


Forsyth, Michael (Stirling)
Mitchell, Sir David


Forth, Eric
Moate, Roger


Fox, Sir Marcus
Montgomery, Sir Fergus


Franks, Cecil
Morrison, Sir Charles


Freeman, Roger
Moss, Malcolm


Gale, Roger
Neubert, Michael


Garel-Jones, Tristan
Nicholson, David (Taunton)


Gill, Christopher
Norris, Steve


Glyn, Dr Sir Alan
Oppenheim, Phillip


Goodlad, Alastair
Paice, James


Greenway, John (Ryedale)
Pawsey, James


Ground, Patrick
Redwood, John


Hague, William
Renton, Rt Hon Tim


Hamilton, Neil (Tatton)
Rowe, Andrew


Hampson, Dr Keith
Shaw, David (Dover)


Hanley, Jeremy
Shepherd, Colin (Hereford)


Harris, David
Smith, Tim (Beaconsfield)


Hayes, Jerry
Stern, Michael


Hayward, Robert
Stevens, Lewis


Hind, Kenneth
Stewart, Allan (Eastwood)


Hogg, Hon Douglas (Gr'th'm)
Stewart, Andy (Sherwood)


Howard, Rt Hon Michael
Stradling Thomas, Sir John


Howarth, G. (Cannock &amp; B'wd)
Summerson, Hugo


Howe, Rt Hon Sir Geoffrey
Taylor, John M (Solihull)


Howell, Ralph (North Norfolk)
Thompson, D. (Calder Valley)


Hughes, Robert G. (Harrow W)
Thompson, Patrick (Norwich N)


Irvine, Michael
Viggers, Peter


Jack, Michael
Widdecombe, Ann


Janman, Tim
Wood, Timothy


King, Roger (B'ham N'thfield)



Knapman, Roger
Tellers for the Ayes:


Knowles, Michael
Mr. Irvine Patnick and


Lennox-Boyd, Hon Mark
Mr. Greg Knight.


Lightbown, David





NOES


Barnes, Harry (Derbyshire NE)
Lofthouse, Geoffrey


Beith, A. J.
Nellist, Dave


Bell, Stuart
Skinner, Dennis


Brown, Nicholas (Newcastle E)



Dixon, Don
Tellers for the Noes:


Godman, Dr Norman A.
Mr. Bob Cryer and


Haynes, Frank
Mr. Ian McCartney.


Hinchliffe, David

Division No. 279]
[2.03 am


AYES


Alexander, Richard
Brown, Michael (Brigg &amp; Cl't's)


Alison, Rt Hon Michael
Browne, John (Winchester)


Allason, Rupert
Bruce, Ian (Dorset South)


Amess, David
Budgen, Nicholas


Arbuthnot, James
Burt, Alistair


Arnold, Jacques (Gravesham)
Carlisle, Kenneth (Lincoln)


Ashby, David
Carrington, Matthew


Aspinwall, Jack
Chalker, Rt Hon Mrs Lynda


Baker, Nicholas (Dorset N)
Chapman, Sydney


Batiste, Spencer
Chope, Christopher


Beaumont-Dark, Anthony
Clark, Dr Michael (Rochford)


Bellingham, Henry
Coombs, Anthony (Wyre F'rest)


Bendall, Vivian
Coombs, Simon (Swindon)


Bennett, Nicholas (Pembroke)
Cran, James


Boswell, Tim
Currie, Mrs Edwina


Bowis, John
Davies, Q. (Stamf'd &amp; Spald'g)


Brandon-Bravo, Martin
Davis, David (Boothferry)


Brazier, Julian
Day, Stephen


Bright, Graham
Devlin, Tim






Douglas-Hamilton, Lord James
McLoughlin, Patrick


Durant, Tony
Maginnis, Ken


Fallon, Michael
Malins, Humfrey


Fookes, Dame Janet
Martin, David (Portsmouth S)


Forsyth, Michael (Stirling)
Maxwell-Hyslop, Robin


Forth, Eric
Mayhew, Rt Hon Sir Patrick


Fox, Sir Marcus
Mitchell, Andrew (Gedling)


Franks, Cecil
Mitchell, Sir David


Freeman, Roger
Moate, Roger


Gale, Roger
Morrison, Sir Charles


Garel-Jones, Tristan
Moss, Malcolm


Gill, Christopher
Neubert, Michael


Glyn, Dr Sir Alan
Nicholson, David (Taunton)


Goodlad, Alastair
Norris, Steve


Greenway, John (Ryedale)
Oppenheim, Phillip


Ground, Patrick
Paice, James


Hague, William
Pawsey, James


Hamilton, Neil (Tatton)
Redwood, John


Hampson, Dr Keith
Renton, Rt Hon Tim


Hanley, Jeremy
Rowe, Andrew


Harris, David
Shaw, David (Dover)


Hayes, Jerry
Shepherd, Colin (Hereford)


Hayward, Robert
Smith, Tim (Beaconsfield)


Hind, Kenneth
Stern, Michael


Hogg, Hon Douglas (Gr'th'm)
Stevens, Lewis


Howarth, G. (Cannock &amp; B'wd)
Stewart, Allan (Eastwood)


Howe, Rt Hon Sir Geoffrey
Stewart, Andy (Sherwood)


Howell, Ralph (North Norfolk)
Stradling Thomas, Sir John


Hughes, Robert G. (Harrow W)
Summerson, Hugo


Irvine, Michael
Taylor, John M (Solihull)


Jack, Michael
Thompson, D. (Calder Valley)


Janman, Tim
Thompson, Patrick (Norwich N)


King, Roger (B'ham N'thfield)
Viggers, Peter


Knapman, Roger
Widdecombe, Ann


Knowles, Michael
Wood, Timothy


Lennox-Boyd, Hon Mark



Lightbown, David
Tellers for the Ayes:


Lilley, Peter
Mr. Irvine Patnick and


Lord, Michael
Mr. Greg Knight.


Maclean, David

Question accordingly agreed to.

Resolved,

That provision may be made for a levy on disposals of securities of companies to which the undertaking of a harbour authority is transferred and companies which control such companies and for the payment into the Consolidated Fund of payments of levy, interest on unpaid levy and penalties in respect of levy.

Ordered,

That it be an Instruction to the Standing Committee on the Finance Bill that it have power to make provision therein pursuant to the foregoing Resolution.

STATUTORY INSTRUMENTS, &c.

INSURANCE

Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &amp;c.),

That the draft Insurance Companies (Amendment) Regulations 1990, which were laid before this House on 8th June, be approved.—[Mr. Patnick.]

The House divided: Ayes 93, Noes 8.

Division No. 279]
[2.03 am


AYES


Alexander, Richard
Brown, Michael (Brigg &amp; Cl't's)


Alison, Rt Hon Michael
Browne, John (Winchester)


Allason, Rupert
Bruce, Ian (Dorset South)


Amess, David
Budgen, Nicholas


Arbuthnot, James
Burt, Alistair


Arnold, Jacques (Gravesham)
Carlisle, Kenneth (Lincoln)


Ashby, David
Carrington, Matthew


Aspinwall, Jack
Chalker, Rt Hon Mrs Lynda


Baker, Nicholas (Dorset N)
Chapman, Sydney


Batiste, Spencer
Chope, Christopher


Beaumont-Dark, Anthony
Clark, Dr Michael (Rochford)


Bellingham, Henry
Coombs, Anthony (Wyre F'rest)


Bendall, Vivian
Coombs, Simon (Swindon)


Bennett, Nicholas (Pembroke)
Cran, James


Boswell, Tim
Currie, Mrs Edwina


Bowis, John
Davies, Q. (Stamf'd &amp; Spald'g)


Brandon-Bravo, Martin
Davis, David (Boothferry)


Brazier, Julian
Day, Stephen


Bright, Graham
Devlin, Tim






Douglas-Hamilton, Lord James
McLoughlin, Patrick


Durant, Tony
Maginnis, Ken


Fallon, Michael
Malins, Humfrey


Fookes, Dame Janet
Martin, David (Portsmouth S)


Forsyth, Michael (Stirling)
Maxwell-Hyslop, Robin


Forth, Eric
Mayhew, Rt Hon Sir Patrick


Fox, Sir Marcus
Mitchell, Andrew (Gedling)


Franks, Cecil
Mitchell, Sir David


Freeman, Roger
Moate, Roger


Gale, Roger
Morrison, Sir Charles


Garel-Jones, Tristan
Moss, Malcolm


Gill, Christopher
Neubert, Michael


Glyn, Dr Sir Alan
Nicholson, David (Taunton)


Goodlad, Alastair
Norris, Steve


Greenway, John (Ryedale)
Oppenheim, Phillip


Ground, Patrick
Paice, James


Hague, William
Pawsey, James


Hamilton, Neil (Tatton)
Redwood, John


Hampson, Dr Keith
Renton, Rt Hon Tim


Hanley, Jeremy
Rowe, Andrew


Harris, David
Shaw, David (Dover)


Hayes, Jerry
Shepherd, Colin (Hereford)


Hayward, Robert
Smith, Tim (Beaconsfield)


Hind, Kenneth
Stern, Michael


Hogg, Hon Douglas (Gr'th'm)
Stevens, Lewis


Howarth, G. (Cannock &amp; B'wd)
Stewart, Allan (Eastwood)


Howe, Rt Hon Sir Geoffrey
Stewart, Andy (Sherwood)


Howell, Ralph (North Norfolk)
Stradling Thomas, Sir John


Hughes, Robert G. (Harrow W)
Summerson, Hugo


Irvine, Michael
Taylor, John M (Solihull)


Jack, Michael
Thompson, D. (Calder Valley)


Janman, Tim
Thompson, Patrick (Norwich N)


King, Roger (B'ham N'thfield)
Viggers, Peter


Knapman, Roger
Widdecombe, Ann


Knowles, Michael
Wood, Timothy


Lennox-Boyd, Hon Mark



Lightbown, David
Tellers for the Ayes:


Lilley, Peter
Mr. Irvine Patnick and


Lord, Michael
Mr. Greg Knight.


Maclean, David





NOES


Barnes, Harry (Derbyshire NE)
Lofthouse, Geoffrey


Beith, A. J.
Nellist, Dave


Bell, Stuart
Skinner, Dennis


Brown, Nicholas (Newcastle E)



Cryer, Bob
Tellers for the Noes:


Dixon, Don
Mr. Ian McCartney and


Haynes, Frank
Dr. Norman A. Godman.


Hinchliffe, David

Division No. 280]
[2.14 am


AYES


Alison, Rt Hon Michael
Amess, David


Allason, Rupert
Arnold, Jacques (Gravesham)





Ashby, David
Hogg, Hon Douglas (Gr'th'm)


Baker, Nicholas (Dorset N)
Howarth, G. (Cannock &amp; B'wd)


Batiste, Spencer
Howe, Rt Hon Sir Geoffrey


Beith, A. J.
Hughes, Robert G. (Harrow W)


Bellingham, Henry
Irvine, Michael


Bennett, Nicholas (Pembroke)
Jack, Michael


Boswell, Tim
Janman, Tim


Bowis, John
King, Roger (B'ham N'thfield)


Brandon-Bravo, Martin
Knapman, Roger


Brazier, Julian
Knight, Greg (Derby North)


Bright, Graham
Knowles, Michael


Brown, Michael (Brigg &amp; Cl't's)
Lennox-Boyd, Hon Mark


Browne, John (Winchester)
Lightbown, David


Burt, Alistair
Lilley, Peter


Carlisle, Kenneth (Lincoln)
Lord, Michael


Carrington, Matthew
Maclean, David


Chalker, Rt Hon Mrs Lynda
McLoughlin, Patrick


Chapman, Sydney
Malins, Humfrey


Chope, Christopher
Maxwell-Hyslop, Robin


Clark, Dr Michael (Rochford)
Mayhew, Rt Hon Sir Patrick


Coombs, Anthony (Wyre F'rest)
Mitchell, Andrew (Gedling)


Coombs, Simon (Swindon)
Mitchell, Sir David


Cran, James
Moate, Roger


Currie, Mrs Edwina
Morrison, Sir Charles


Davies, Q. (Stamf'd &amp; Spald'g)
Moss, Malcolm


Day, Stephen
Norris, Steve


Devlin, Tim
Oppenheim, Phillip


Douglas-Hamilton, Lord James
Paice, James


Durant, Tony
Redwood, John


Fallon, Michael
Renton, Rt Hon Tim


Fookes, Dame Janet
Rowe, Andrew


Forsyth, Michael (Stirling)
Shaw, David (Dover)


Forth, Eric
Shepherd, Colin (Hereford)


Franks, Cecil
Smith, Tim (Beaconsfield)


Freeman, Roger
Stern, Michael


Gale, Roger
Stewart, Allan (Eastwood)


Garel-Jones, Tristan
Stradling Thomas, Sir John


Glyn, Dr Sir Alan
Summerson, Hugo


Goodlad, Alastair
Taylor, John M (Solihull)


Gow, Ian
Thompson, Patrick (Norwich N)


Greenway, John (Ryedale)
Viggers, Peter


Hamilton, Neil (Tatton)
Widdecombe, Ann


Hampson, Dr Keith



Hanley, Jeremy
Tellers for the Ayes:


Harris, David
Mr. Irvine Patnick and


Hayward, Robert
Mr. Timothy Wood.


Hind, Kenneth





NOES


Barnes, Harry (Derbyshire NE)
Nellist, Dave


Bell, Stuart
Skinner, Dennis


Godman, Dr Norman A.



Haynes, Frank
Tellers for the Noes:


Hinchliffe, David
Mr. Bob Cryer and


Lofthouse, Geoffrey
Mr. Ian McCartney.

Question accordingly agreed to.

COMPANIES

Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &amp;c.),

That the Companies (Fees) (Amendment) Regulations 1990 (S.I., 1990, No. 1197), dated 7th June 1990, a copy of which was laid before this House on 8th June, be approved.—[Mr. Patnick.]

Question agreed to.

NORTHERN IRELAND

Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &amp;c.),

That the draft Planning and Building Regulations (Amendment) (Northern Ireland) Order 1990, which was laid before this House on 16th May, be approved.—[Mr. Patnick.]

Question agreed to.

EUROPEAN COMMUNITY DOCUMENTS

VOTING RIGHTS

Motion made, and Question put forthwith pursuant to Standing Order No. 102(5) (Standing Committees on European Community Documents),

That this House takes note of European Community Documents Nos. 7398/88 and 4218/90, relating to voting rights for Community nationals in local elections in their Member State of residence; and endorses the Government's view that the right to vote and stand as a candidate in local elections is primarily a matter of political rights which extends beyond the Community's competence and should be left to individual Member States to decide.—[Mr. Patnick.]

Question agreed to.

Denby Grange Colliery

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Patnick.]

Mr. David Hinchliffe: Even at this late hour, I am grateful to have the opportunity to raise several matters relating to my constituency. The closure of the Denby Grange colliery, the last pit in the Wakefield constituency, means that the period of the present Government has seen the complete destruction of an industry which had been the backbone of the Wakefield economy for generations. Although this debate is prompted by that closure, I wish to widen the issue. The Government are obstructing Wakefield's attempts to replace lost jobs in traditional industries. I should like to explain what we in Wakefield believe is needed from the Government to enable us to move forward in the process of re-industrialisation.
I am grateful to my hon. Friend the Member for Pontefract and Castleford (Mr. Lofthouse) for remaining until this late hour. I hope that he will catch your eye later, Mr. Deputy Speaker, so that he can briefly contribute in support of my arguments. My hon. Friend has argued much longer than I have, and I appreciate his support tonight.
I have no desire to paint an entirely black picture of the economy of the Wakefield district. As the Minister is well aware, there are some positive factors. I commend Wakefield metropolitan district council on its efforts with job regeneration in recent years to offset the rundown in traditional industries such as coal. The economic development department of the local authority has fought tooth and nail for new industry, with considerable success. The Minister is familiar with some examples—the Coca-Cola Schweppes Beveridges and Nacanco development came to the Wakefield 41 site in 1988, creating 180 jobs, with a potential for 500 jobs. The Wakefield 41 business park, which opened in October last year, has the potential for some 1,200 jobs, and we hope that it will be the success that we expect. Asda's new distribution centre in the Normanton industrial estate has the potential for some 350 jobs.
These developments have been achieved entirely through local effort. Companies have recognised the tremendous potential of the Wakefield district. The Minister is familiar with Pioneer, the Japanese audiovisual company, which has been attracted to the Whitwood Common site in Pontefract and Castleford. We hope that it will create 500 jobs in the first phase, and the number is expected to double in the second phase. The Minister will recall some months ago meeting the four Wakefield district Members of Parliament, the local authority representatives, and representatives of the Yorkshire and Humberside Development Association. We pressed him to give Government assistance to bring Pioneer to Wakefield to create much-needed jobs. We had tea and biscuits and sympathy, but not much help.
All the developments that I have mentioned are specific to the motorway corridor of the M1 and M62. It is of particular concern to the local authority that future developments on the corridor will be restricted by limitations on land.
The Minister may point to the fact that official unemployment figures have fallen recently. I would argue


that that fall has been due in large part to the efforts of Wakefield district council to attract local employment. It is also important to stress that the Government's changes in the unemployment count have had a direct bearing on the specific circumstances of Wakefield district. I refer in particular to the Government's 29th adjustment of the count, aimed at reducing the unemployment figure—the amendment of the redundant mineworkers scheme, which has relieved a number of ex-miners in the Wakefield area of the requirement to sign on. In an area where the coal industry is in decline, that is bound to have a huge impact on the number of people registering as unemployed.
The closure of Denby Grange colliery is a body blow to Wakefield's hopes of a revival in its economic prospects. It is particularly bad news for those employed at the pit, many of whom are known to me personally and have worked so hard to keep the pit going over a number of years during which its future has been threatened. It is particularly sad to note that a number of the employees affected had already experienced two or three pit closures before moving to Denby Grange. The numbers involved in the closure are worrying. About 200 contractors are losing their work at the pit because of the closure. About 620 miners are directly affected, as well as about 50 administrative and managerial staff. The bulk of the employees affected are under 30, so they will be seeking alternative employment. I know that the Minister has had a long hard day, but I must point out to thim that that brings the total of pit job losses in Wakefield under the present Government to around the 16,000 mark.
My hon. Friend the Member for Pontefract and Castleford will echo this point. The map for assisted areas was last drawn up in 1984, but the majority of job losses in the coal and related industries have occurred since then. In 1984, Wakefield had 16 collieries and 15,340 miners. We now have three collieries employing 2,690 miners. Those figures represent a loss of 13 collieries and more than 13,000 jobs in just five years, since the last assisted area map was drawn up. In the same period, job losses in mining-related industries have totalled nearly 3,000. Subcontractors have been directly affected and mining engineering in Wakefield has been badly affected, with hundreds of people losing their jobs.
All this gives cause for concern about our export record. Many of the mining engineering companies in Wakefield are major exporters and earners for Britain. Some companies are worried that the decline in the home coal industry makes it more difficult for them to market their products to foreign Governments. A recent study of the engineering sector by Leeds polytechnic said that Wakefield
has an engineering industry structure which is unfavourably biased away from the relatively buoyant segment and in favour of a segment which is nationally experienced high relative decline.
It is worth mentioning also that, since the Government came to power, Wakefield's other backbone industry, the textile industry, has lost about 5,000 jobs.
The Government's policy is obstructing Wakefield's attempt to re-industrialise, and the side effects of that policy have had a major impact on our continuing problems. High interest rates are a case in point. Last week, the Forum of Private Business, a lobby group representing 17,000 companies, conducted a survey suggesting that the Government's high interest rate policy

had cost Yorkshire and Humberside almost 70,000 new jobs, a number of which would have come to the Wakefield district to offset the job losses in traditional industries.
We must also consider the way in which the Government have failed to invest in the infrastructure which would have encouraged renewed investment and employment in the Wakefield district. The most recent example of that is the Government's failure to invest in high speed direct rail links from the north to the channel tunnel. That makes the task of job creation in an area such as mine that much more difficult.
Government policies have led directly to the export of British jobs from areas such as Wakefield. That has a major bearing on our predicament, particularly in the coal industry. The privatisation of electricity generation has led directly to a huge increase in coal imports. The Government have actively supported private measures such as the Humber Ports Bill promoted by the Minister's Parliamentary Private Secretary which have been geared towards importing bulk cargos such as coal from countries such as South Africa.
Last month an Oxford economist called Terry O'Shaunessy said that the Government's policies will not only lead to further massive mining job losses but will increase the trade deficit by up to £1,500 million per year. In that respect, the Government's policies are economic madness, especially in view of the present huge balance of payments deficit. Obviously, such policies are a death warrant for what is left of the coal industry in Wakefield district.
I wish to pinpoint the two main areas which are of major concern to my colleagues in the Wakefield district and to Wakefield district council in seeking to create new jobs and industries in the area. We face those problems against a background of difficulties which in many instances are related to Government policies as we try to re-industrialise the area.
Wakefield has been included in the European Commission's RECHAR programme—an aid programme for coalfield areas. When it was announced, it appeared to be a major boost for the Wakefield district. Unfortunately, there is a nasty sting in the tail as a result of Government policy. The economic development officer of Wakefield described it as a poisoned chalice when I spoke to her yesterday.
I hope that the Minister will respond to that particular point when he replies. Because Government restrictions on local authority capital spending were determined before it was known that RECHAR funds would be available, in order to spend RECHAR money other planned projects have to be shelved or RECHAR has to be spent on projects that would have gone ahead anyway. The whole purpose of RECHAR projects is that they should result in additional schemes targeted on local problems such as those in Wakefield with the declining coal industry.
The British Government, however, are the only Government in the Community completely to undermine the intention of the RECHAR programme. That has enormous obvious consequences for places like Wakefield. One could say with regard to RECHAR, "The EEC giveth, and the British Government taketh away."
I wish now to consider assisted area status. The Minister is aware that in Wakefield we have been pressing for a long time for that status because the boundaries were drawn up in 1984 and they are now completely irrelevant for areas such as Wakefield. One way to overcome the


Catch-22 situation that I have described with regard to RECHAR is for the local authority concerned to be designated an assisted area or urban programme area. That would extend the local authority's capital borrowing powers by the cost of whatever schemes are acceptable to central Government and allow EC finance to be set against the cost. Those are schemes in addition to the original capital programme and therefore fit the EC requirement. I plead with the Minister to listen specifically to that point, because without that secondary assistance RECHAR is largely irrelevant to many of the problems that we face in Wakefield.
In Wakefield—my hon. Friend the Member for Pontefract and Castleford will support me in this—we believe that there is no justification for the continued exclusion of Wakefield from assisted area and urban programme status. The changes in the employment base of Wakefield since 1984 mean that we should be included in the programme to do the job that our constituents want us to do. Wakefield must be unique, and it must be recognised by the EC for RECHAR, but it has had no recognition from the Government, although we have put our problems to Ministers time and again. This is my third Adjournment debate on the subject. My hon. Friend has been pressing the matter for years and has also had an Adjournment debate on it.
Regional assistance is now totally out of date and must be revised urgently. I hope that the Minister will appreciate these points, the efforts that we have made, and the fact that we have had some success in our task. We could have much more success with the kind of assistance that I have described.

Mr. Geoffrey Lofthouse: rose—

Mr. Deputy Speaker (Mr. Harold Walker): Order. Does the hon. Member for Pontefract and Castleford (Mr. Lofthouse) have the consent of the hon. Member for Wakefield (Mr. Hinchliffe) and the Minister?

Mr. Hinchliffe: Yes.

The Minister for Industry (Mr. Douglas Hogg): Yes.

Mr. Lofthouse: I shall be brief to allow the Minister to reply as fully as he possibly can.
I am grateful to my hon. Friend the Member for Wakefield (Mr. Hinchliffe) for allowing me to intervene in his Adjournment debate, and I congratulate him on being successful in the ballot. As my hon. Friend said, this is the latest of many debates to try to influence the appropriate Minister of the needs of mining communities, especially in the constituencies of Wakefield and Pontefract and Castleford. I probably sound like a parrot: I have explained the problem time and again, but, unfortunately, my words have so far fallen on deaf ears.
The Minister will recall that the Energy Select Committee published two major reports—one on the coal industry, and one on the privatisation of electricity production. Those reports highlighted the problems that have been and will be created by further pit closures in mining communities. However, to date, my constituents

have not received any aid to attract alternative industry. As my hon. Friend has said, we have had some success with Pioneer and Coca-Cola, but that success was brought about by the efforts of the local authority. There has been no financial assistance from the Government.
We are approaching a serious situation because the rundown of the coal industry has not ended. In fact, the rundown will be rapid over the next two or three years and beyond, but there are no signs of any Government assistance.
At the time of the Denby Grange announcement, there was another announcement on the Allerton Bywater workshops in my constituency. Four hundred men lost their jobs. I went to the workshops a short while ago, and it was quite obvious that quite a lot of money had been spent there. Looking at the new buildings, one would think that capacity would last for years and years. One old-timer in the workshops said, "There's something going on up here. They're spending a lot of money. I'll bet they're going to flog it." I bet he is not far off. I bet that somebody will get hold of that wonderful workshop with all its equipment and put it into the private sector. In my constituency, 10,000 jobs have been lost since the miners' strike, and we expect many more to go.
I support all that my hon. Friend has said. I understand the difficulties about redrawing the intermediate area status map because they have been put to us year in and year out. It is ironic that we enjoyed intermediate area status until about 1981 when we had all the pits working in the constituency.
There are to be further rundowns, and the Government should provide assistance as soon as possible. When the time comes to redraw the map, I hope that the Minister will find a way to include Wakefield and the Pontefract and Castleford travel-to-work area. There will be great devastation as a result of the Government's deliberate policy of electricity privatisation. The decision last week to subsidise the nuclear power industry will also hit the coal industry. How can the Government justify the running down of a major source of energy and at the same time be prepared to subsidise another form of energy, the full cost of which is not known? Nobody is really concerned to find out the true cost, including decommissioning, of nuclear energy.
If the Government continue to wipe out the coal industry, they have an obligation to encourage alternative employment for men whose average age, as my hon. Friend the Member for Wakefield has said, is 30 to 33. Such men cannot be thrown on the scrap heap and if they are not provided with alternative employment there will be social unrest. I hope that the Minister will seriously consider our request.

The Minister for Industry (Mr. Douglas Hogg): The hon. Member for Wakefield (Mr. Hinchliffe) has raised the question of the closure of the Denby Grange colliery and its implications for the Wakefield district. I fully recognise his concern about that. However, as I am sure he is aware, and he accepts, decisions on pit closures remain a commercial matter for British Coal. It is not for the Government to seek to intervene in these commercial decisions. They are for the management to make in the light of its costs and the relative competitive position of


what it produces. One understands the uncertainty, worry and disturbance that this is bound to cause the miners involved, their families, and naturally the wider community.
As the hon. Gentleman will know, where jobs are lost, British Coal offers generous redundancy terms that are in line with the best available in British industry. To date, British Coal has managed the restructuring of the industry without the need for compulsory redundancies. Any miner wishing to stay has had the option of moving to another pit rather than taking redundancy.
The hon. Members for Wakefield and for Pontefract and Castleford (Mr. Lofthouse) concentrated on the effect that the closure will have on the Wakefield area. They commented on what they see as a shortage of Government assistance to help the area overcome problems caused by the rundown of the local mining industry. Both hon. Gentlemen, most notably the hon. Member for Pontefract and Castleford, called on the Government to give Wakefield assisted area status. I am afraid that I must make it plain that there is no prospect of granting such status in advance of any general review of the assisted area status map.
Unemployment in Wakefield and Dewsbury currently stands at 7.3 per cent. compared with the Great Britain average of 6.2 per cent. The average for all intermediate areas is 8 per cent. and the average for all development areas is higher at 11 per cent. I had the pleasure of meeting both hon. Members some time ago when they came to see me about a particular inward investment. At that time we discussed the prospects of giving assisted area status to Wakefield.
The plain truth is that the number of registered unemployed in Wakefield and Dewsbury does not justify according the area assisted area status—certainly not now. Moreover, as I explained to both hon. Gentlemen when they were good enough to see me, we do not intend to redraw the map during the lifetime of this Parliament. Therefore, there is no immediate prospect whatever of Wakefield being given assisted area status. However, when the map is reviewed, the position of Wakefield will be considered. What both hon. Gentlemen have said will be taken into account.

Mr. Lofthouse: Although the Minister has given the figures for Wakefield and Dewsbury and compared them with the national figures, he has not referred to the figures for the Pontefract and Castleford travel-to-work area, which are much higher. It is one of the blackspots. It is a mining community within the Wakefield metropolitan district area. The Government will find, if my figures are correct, that unemployment is about 11 per cent.

Mr. Hogg: I make two points in reply to the hon. Gentleman. First, the Castleford and Pontefract area is probably too small to attract assisted area status. The matter could be examined but it is probably too small on its own. Secondly, we do not have it in mind to redraw the map during the lifetime of this Parliament.

Mr. Lofthouse: But Pontefract and Castleford is a travel-to-work area which previously enjoyed intermediate area status. The boundaries were extended out into the rural areas at about the same time. That brought

unemployment down. Some people may have thought that that was a deliberate policy. Nevertheless, the area is a travel-to-work area. It enjoyed that status before, and it was considered large enough to have intermediate area status then.

Mr. Hogg: Whatever the force of the hon. Gentleman's point that it is a travel-to-work area, we do not propose to redraw the map during the lifetime of this Parliament. The hon. Gentleman knows that because we discussed it when we had the pleasure of meeting some months ago.
I now wish to turn to several issues which were directly or indirectly raised during the debate. The Government have been criticised for doing insufficient to assist the development of employment in the area. I do not agree with that criticism, but before I come to the detail of what the Government are doing—withal the time permitted to me—it is right to say that British Coal provides considerable assistance in the mining areas of Yorkshire which have been affected by the pit closures. British Coal Enterprise Limited was set up in 1984 to help create employment opportunities in the coalfield regions. It provided loan finance to businesses setting up, expanding or relocating in mining areas. In the Yorkshire region alone it provided loans of £8.9 million to 415 businesses. That led to the creation of over 5,000 jobs. I understand that approximately 30 per cent. of these jobs relate to the Wakefield metropolitan district council area.
British Coal Enterprise has also provided financial sponsorship to the Wakefield enterprise agency and funded managed workshops and small business units. These schemes aim to provide new employment opportunities for anyone in the coal industry.
Another aspect of Government activity, which I must mention briefly—I have only two minutes left—is the effect of the consultancy initiatives operated by the Department of Trade and Industry. As the House will be aware, the scheme aims to encourage small and medium-sized businesses to recognise the need for, and benefit from, the use of outside expertise. My Department provides 50 per cent. of the cost of such consultancies in the Wakefield area. To date, over 70 companies in the Wakefield area have taken advantage of it.
My Department also runs the research and technology initiative under which there are several schemes to encourage collaborative industrial research projects. Firms in Wakefield are eligible.
I should mention that Wakefield has an enterprise zone, at Langthwaite Grange. It has also been accorded the status of a derelict land clearance area. This means that public sector reclamation schemes qualify for derelict land grant—

Mr. Hinchliffe: Will the Minister give way?

Mr. Hogg: I shall not. I have only one more minute of my reply.
This means that public sector reclamation schemes qualify for derelict land grant at a rate of 100 per cent. of eligible costs, and private sector schemes at a rate of 80 per cent.
I am glad to say that since 1985 Wakefield has received more than £2.3 million in derelict land grant,


and as part of the council's three-year rolling programme a further £650,000 has been allocated by the Department of the Environment for the financial year 1990–91.

The Government's small firm service has also been—

The motion having been made after Ten o'clock and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at five minutes to Three o'clock.